Skip to main content

Full text of "Views on business education"

See other formats


CONTRIBUTIONS BY FRED C. FOY, RICHARD M. PAGET 
HOWARD G. BOWEN, WILLIAM B. AYCOCK, FRED C. COLE 
SAMUEL GOLDBERG AND H. J. LEAVITT WITH AN 
INTRODUCTION BY MAURICE W. LEE 



A SYMPOSIUM 



* 



Lsn • o >/ 




EDUCATION 



PUBLISHED FOR THE AMERICAN ASSOCIATION OF COLLEGIATE 
SCHOOLS OF BUSINESS BY THE UNIVERSITY OF NORTH CAROLINA 
SCHOOL OF BUSINESS ADMINISTRATION AT CHAPEL HILL 



of JUxtrtfta 
Ethrart^s 




ait? (gift of 
C. C. Oliver 



Digitized by the Internet Archive 
in 2013 



http://archive.org/details/viewsonbusinesseOOamer 



VIEWS ON BUSINESS EDUCATION 



VIEWS ON 

BUSINESS EDUCATION 



FRED C. FOY 

RICHARD M. PAGET 

HOWARD G. BOWEN 

FRED C. COLE 

WILLIAM B. AYCOCK 

SAMUEL GOLDBERG 

H. J. LEAVITT 

with an 
introduction by 

MAURICE W. LEE 



PUBLISHED FOR THE AMERICAN ASSOCIATION 
OF COLLEGIATE SCHOOLS OF BUSINESS BY THE SCHOOL 
OF BUSINESS ADMINISTRATION, UNIVERSITY OF 
NORTH CAROLINA CHAPEL HILL, I960 



Copyright I960 

American Association of Collegiate Schools of Business 

Material in this book may be reproduced 
without permission provided suitable 
acknowledgment is made. 



Manufactured in the United States of America 
by the Christian Printing Company 
Durham, North Carolina 




For additional copies write to: 

The School of Business Administration 
The University of North Carolina 
Chapel Hill, N. C. 



The American Association of 

Collegiate Schools of Business is indebted to 

The Ford Foundation for the grant which 

made this publication possible, the University 

of North Carolina School of Business Administration 

for directing the publishing of these 

manuscripts, and to Roy W. Holsten, Assistant to 

the Dean of the University of North Carolina 

School of Business Administration, who served 

as editor of the publication. 



CONTENTS 

1 A Prologue to Some Diverse Views on Business Education 1 

By Maurice W. Lee 

2 A Businessman Looks at Business Education 1 1 

By Fred C. Foy 

3 Education for Business Management 23 

By Richard M. Paget 

4 Liberal Education for Business 37 

By Howard G. Bowen 

5 The Business School, the University, and the President 47 

By Fred C. Cole 

6 A Chancellor Looks at Business Education 55 

By William B. Ay cock 

1 Mathematics for Business Students 65 

By Samuel Goldberg 

8 Behavioral Science in the Business School 75 

By H. J. Leavitt 



A Prologue to Some 
Diverse Views on 
Business Administration 



BY MAURICE W. LEE 

Dean 

School of Business Administration 

University of North Carolina 



X 



he field of collegiate education for business has, in recent 
years, probably been studied, evaluated, and reflected upon more 
than any other segment of our system of higher education. This 
sort of analysis has been a continuing thing over many years with 
respect to the American Association of Collegiate Schools of Busi- 
ness. 1 It has been done effectively and with constructive rigor by the 
business community. 2 And finally, the two studies completed in 
1959 for the Carnegie Foundation and the Ford Foundation have 
provided the latest impetus for this continuing reevaluation of the 
field. 3 All in all the decade of the fifties was an interesting one for 
those who have been participants in the work of the field being 
studied. 

As the published Ford and Carnegie studies became available 
they were distributed widely to faculty members in the field of 
business administration. A great many schools used these studies 
as a further peg upon which to base a continuing reexamination of 
their own purposes and performance. 



1. Reference could be made to the work of various standing and special com- 
mittees of the Association, to the Arden House Conference sponsored by the Asso- 
ciation and made possible through a grant of funds from the Ford Foundation in 
1955, to the 1956 study of the Standards Committee and to the successive annual 
programs of the A.A.C.S.B. devoted to the general consideration of standards and 
performance with respect to collegiate education for business, and to the study by 
Kozelka for the Association in 1954, Professional Education for Business. 

2. As for example, see Business Looks at Business Education, a study done by the 
Business Executives Research Committee and published by The School of Business 
Administration, University of North Carolina, Chapel Hill, 1958. 

3. See Frank Pierson, et at., The Education of American Businessmen (New York: 
McGraw-Hill Book Co., 1959) and Robert A. Gordon and James E. Howell, Higher 
Education for Business (New York: Columbia University Press, 1959), the former 
the Carnegie study and the latter the Ford Foundation study. 



4 MAURICE W. LEE 

In the early months of I960 seven regional conferences were 
held at Boston, Massachusetts; Stillwater, Oklahoma; East Lansing, 
Michigan; State College, Pennsylvania; Minneapolis, Minnesota; 
Palo Alto, California; and Chapel Hill, North Carolina. These 
conferences, made possible by a grant from the Ford Foundation, 
were held under the auspices of various member schools of the 
American Association of Collegiate Schools of Business. They pro- 
vided an opportunity for business administration staff members to 
make an intensive study of the content of the two foundation 
volumes. By late spring, I960, several hundred business administra- 
tion faculty members had participated actively in the ongoing exami- 
nation of their field. And most certainly every member school in 
the A.A.C.S.B. had, by that time, devoted many hours to the further 
reevaluation of its own work. 

The annual meeting of the American Association of Collegiate 
Schools of Business was held in May, I960, against this background 
of decade-long study of the field of collegiate education for business 
culminating in the intensive, internal self -analysis each school under- 
took following the publication of the two foundation studies. It 
was appropriate then that the I960 meeting should be devoted to 
some views of business education from outside the field itself. 

The principal speakers were a distinguished company, con- 
sisting of three top businessmen: Fred C. Foy, President and Chair- 
man of the Board of Koppers Co., Inc.; Albert Hettinger, senior 
partner, Lazard Freres & Co.; and Richard M. Paget, partner in 
Cresap, McCormick & Paget; three distinguished university presi- 
dents; Howard G. Bowen of Grinnell College; Fred C. Cole of 
Washington and Lee University; and W. B. Aycock, Chancellor of 
the University of North Carolina; two outstanding scholars from 
academic fields outside business administration, H. J. Leavitt of 
Carnegie Institute of Technology, who talked on the behavioral 
sciences, and Samuel Goldberg, on leave from Oberlin and now 
visiting associate professor at the Harvard Graduate School of 
Business who, as a mathematician, talked on mathematics and the 
business curriculum. These papers were of such high quality and 
general interest as to lead to their publication in this present volume, 



Some Diverse Views on Business Education 5 

the first time such a step has been taken by the American Associa- 
tion of Collegiate Schools of Business. It is regretted that the pressure 
of his other commitments made it impossible for Mr. Hettinger to 
prepare a formal paper for inclusion in this volume. His talk was 
stimulating and thought-provoking. 

Reflections on the State of Business Education 

We may join with President Cole in the view that "business edu- 
cation in general has undergone, and is undergoing, an admirable 
adaptation to changing needs and conditions" and still avoid any 
degree of complacency about the state of business education. We may 
point with pride to the giant steps which have been taken and still 
view with concern those which must be taken. As Fred Foy notes 
in his paper, "the sheer magnitude of the problem that faces the 
business schools over the two or three decades ahead is an eye-opener 
to an outsider." To an insider it is more than eye-opening. It is a 
continuing challenge which shows no sign of abating in the years 
ahead. The following quotation may serve to give emphasis: 

"Faculty members in departments and schools of business ad- 
ministration are part of an evolution that threatens momentarily to 
become a revolution. One who has been away for any appreciable 
length of time and has only recently returned to his office in the 
schools of business must be wondering, at least secretly, if the pace 
of developments is not rendering him obsolete. It might well be 
asked what is expected of the present-day faculty in a school of 
business. 

"It is not easy to describe today's business school faculty mem- 
ber. To teach and do research in a modern school of business, the 
faculty member, it would seem, must have taken integral and dif- 
ferential calculus, have worked with modern algebra, know some- 
thing of set theory and symbolic logic, be familiar with matrix 
algebra, and know something of computer programming and 
applications in the field of operations research. He must also 
have done a great deal of work in the field of social psychology, 
for he must know not only about the behavior of individuals, 
but must study them as members of groups and know about the 
motivation of groups. He will need to have mastered the rudiments 
of sociology and have more than a passing acquaintance with the 
jargon and insights of cultural anthropology. And he must not 
acquire these things at the expense of a sound grounding in eco- 
nomics, for that is fundamental. We take it for granted that he will 



6 MAURICE W. LEE 

not only be acquainted with but expert in the tool fields of ac- 
counting and statistics. And then he must master at least one — and 
preferably most — of the functional fields of business: marketing, 
finance and production." 4 

Business schools are on the move. They are one of the dynamic 
forces in American higher education today. The modern school of 
business is developing a network of interrelations with other parts 
of the university. There has always been a close integration of the 
work in the department of economics and the school of business. 
But this is today only symbolic of the expanding range of such 
interrelations between the business school and other departments 
and schools of the university. By way of illustration, during the 
past semester courses offered by The School of Business Admini- 
stration at Chapel Hill are being taught by faculty members from 
the departments of philosophy, sociology, economics, psychology, 
mathematics, and theoretical statistics. Members of the university 
faculty from other departments are auditing courses in The School 
of Business Administration and members of the faculty of the latter 
are taking formal course work in mathematics and statistics, to 
name two. Research projects are bringing together teams which 
include members of the faculty of these departments and the busi- 
ness school faculty. Business school faculty members are serving in 
an advisory capacity with respect to curricular considerations of 
other departments and members of these departmental faculties are 
similarly serving the business school. 

All of this goes far to make it clear that if ever the business 
schools deserved criticism for isolated, self -centered thinking (and 
preoccupation with the problems inherent in the development of this 
comparatively new field in higher education would have made such 
a condition understandable ) that is clearly no longer the case. Today 
the business school is in the mainstream of the intellectual life of 
the university. 

Business schools in all sections of the country have made signifi- 
cant strides in both the liberalization of their programs and the 
strengthening of their offerings. Consolidations of formerly frag- 



4. Maurice W. Lee, "It's Good to Be in a Business School," Business Horizons, 
Indiana University, Vol. 3, No. 2, Summer I960, p. 4. 



Some Diverse Views on Business Education 7 

merited offerings are commonplace today. Greater emphasis is being 
given to the analytical content of offerings. Opportunities for the 
reeducation and training of faculty members in the basic supporting 
areas of mathematics and the behavioral sciences are being found. 
The Foundations have made important contributions in this direction. 
But quite apart from the help of outside grantors, many business 
schools are using their own scarce resources to provide just these 
same opportunities. No part of our system of higher education is 
being more thoroughly reworked by those active in it than is the 
field of education for business. 

In these efforts to improve and strengthen higher education for 
business the schools of business will need a great deal of support 
and understanding from those outside the field. Commonly the 
instances of excessive fragmentation and over-specialization in curri- 
cula and course offerings can be traced to outside pressure from 
trade groups. Too often the central administration of a university 
has regarded the business school as a proprietary operation run to 
produce a profit for the rest of the institution. No business school 
can become great if it is not able to withstand such efforts and no 
business school can withstand them unless it has the understanding 
and support of the central administration. 

No business school can become a great school of business if it 
is not associated with a strong university or college. The school of 
business must depend upon the rest of the university for the funda- 
mental training its students get in their pre-professional work. It 
is not conceivable that the school of business can successfully develop 
a rigorously analytical program if, for example, the students who 
come to it have had a totally inadequate educational experience in 
their course work in the department of mathematics. Nor can the 
school of business develop its own offerings in sound fashion if the 
students entering the school of business have not had a truly liberal 
education in the course of their work taken outside the business 
school. 

In short, the schools of business, today, are becoming leaders in 
the drive to build a stronger liberal arts background under the pro- 
fessional curriculum. As President Bowen notes in his paper, "The 



8 MAURICE W. LEE 

biggest task of the business dean is to find ways to get appropriate 
education for business students in the arts and sciences. The business 
dean of the future must become one of the leaders in the university 
in the advocacy of true liberal education." If the first courses offered 
in psychology, economics, chemistry, or sociology are designed as 
first courses in a professional sequence for the major in these fields, 
they will hardly serve the purposes of the business school and clearly 
they may not be regarded as liberal arts courses. 

The future success of collegiate education for business rests 
heavily upon the ability of the business school to develop and sustain 
the interest and cooperation of other parts of the university. This 
cannot be ordered. It will develop only through mutual respect and 
shared interest in worthwhile endeavors. The business school will 
not catch the interest of nor have the cooperation of those in other 
departments if it is not also vitally interested in and anxious to 
cooperate with them. A psychologist should not be expected to 
subordinate his professional interests and future to the purposes of 
the business school. 

Reflections on the Future 

If, with Heilbroner, we may reflect on the future as a projection 
of trends now visible from the immediate past, certain rather evident 
things may be said about the field of collegiate education for busi- 
ness. A good business school will be at the center of intellectual life 
on its own campus. It will be in the forefront of those parts of the 
university which continue to insist upon higher and more meaningful 
standards for admission to the university. It will be a leading propo- 
nent of added emphasis upon a truly liberal background in the arts 
and sciences. It will be all these things because it must. And in so 
doing the business schools will become centers of exciting and stimu- 
lating intellectual activity on their campuses. 

In the venturesome philosophy of business education which is 
now evolving emphasis is given to two new roots of business edu- 
cation. One is the foundation stemming from the quantitative side 
and the other is that in the behavioral sciences. (Economics remains, 



Some Diverse Views on Business Education 9 

as it has always been, one of the basic disciplines underlying business 
education.) It is almost a foregone conclusion that the business 
school's faculty will, in the future, be intimately associated with 
colleagues in these departments. To illustrate, on most campuses 
the mathematics curriculum was originally designed with an eye to 
the needs of the natural sciences. As the business schools and the 
social science departments have turned more directly to the incor- 
poration of quantitative methods in their own work new sequences 
and different content must be designed for the service courses offered 
by the mathematics departments. Inevitably business schools will be, 
and many in fact already are, playing an increasing role in the 
development of these newer approaches, in mathematics and in the 
behavioral sciences. 

The challenges and opportunities which lie before the business 
schools are large indeed. They are opportunities to work and col- 
laborate with the best minds in the university. They are challenges 
to develop and sustain the interest and cooperation of the whole 
university community in the ongoing of a shared interest in profes- 
sional education for business. But the business schools will neither 
catch the interest nor have the cooperation of those in other depart- 
ments if they are not also vitally interested in and anxious to co- 
operate with them. 

Given these evolutionary developments the business schools of 
the future will be among the most stimulating and exciting segments 
of our universities and colleges. They will demand faculties of 
superior capacity and better-than-average student bodies. They will 
stand near the center of intellectual ferment on their campuses. 
These are the conclusions which would seem to flow from the 
remaining papers in this volume. 



A Businessman Looks 
at Business Education 



BY FRED C. FOY 

Chairman and President 
Koppers Company, Inc. 



Xrofessors Gordon and Howell begin their recent study 
of the state of business education with a section entitled, "Business 
Education Adrift." I am not competent to judge whether the evalua- 
tion that fills up the next several hundred pages is accurate. But if 
their picture is even approximately right, there is merit in the 
opening subtitle. At the very least, the sheer magnitude of the 
problem that faces the business schools over the two or three dec- 
ades ahead is an eye-opener to an outsider. 

What can a busy businessman say that may be helpful in rela- 
tion to this problem? I am no expert on business education — indeed 
I have not even had a chance to read completely the two thick 
volumes on which this conference is focused. Perhaps the most 
useful thing I can do is to say something on three broad points — 
all centered around the general question of what I, as one individual 
businessman, think that American business has a right to expect 
of the business schools. 

Some Fundamental Questions 

First, what kind of graduates do we want, and what can we rea- 
sonably expect the business schools to do about providing that 
sort of individual? 

The standard question is, what are the qualities that mark 
the man who promises to rise to top management? I have no pat 
answer to that. Nor do I think that the same qualities pay off best 
for every job. But it is clear, I think, that American business needs 
most at every level men with personal qualities like these: drive 



14 FRED C. FOY 

and hard work, practical problem-solving ability, ability to com- 
municate effectively and ability to work effectively with others, 
imagination and ability to learn on the job, breadth and adapt- 
ability, and certainly not least a strong set of personal moral and 
ethical values. 

We don't think we are going to get many paragons with all 
these virtues. But I list them to emphasize the fact that qualities 
like these are the ones that seem to pay off best in management, at 
both lower and upper levels — rather than a detailed knowledge of 
technical skills and large amounts of "know-how". 

Probably no two successful businessmen would agree exactly 
on any such list of most-wanted qualities, and I don't intend to 
put particular stress on the specific list above. But I think that you 
will get substantial agreement from successful businessmen, as both 
Gordon-Howell and Pierson have done, on the fundamental im- 
portance of such qualities for success in business, in contrast to 
detailed knowledge of specific courses or of technical fields. 

What can we expect the business schools to do about develop- 
ing these personal qualities? I suspect that all of them are teachable. 
Certainly they are much harder to teach than to provide a student 
with a description of how leading firms now carry out some parti- 
cular business operation. But I think the business schools ought to 
think long and hard about how to teach the most important things, 
rather than teaching primarily the less important ones just because 
they are easier. 

Suggestions Concerning the Curriculum 

Specifically, let me suggest four things I think the business schools 
can teach — on which I would put considerable emphasis: 

1. Practical problem-solving ability. 

2. Ability to communicate effectively, verbally and in writing. 

3. Understanding of how the American economy works. 

4. A basic understanding of the various major practical areas of 
business — marketing, finance, purchasing, etc. 

Let me comment briefly on each of these four. 



A Businessman Looks at Business Education 15 

I mean by practical problem-solving ability, the ability to take 
a problem, large or small; to size it up and sort out the major 
considerations involved; to recognize the additional information 
needed and to get it as far as this is feasible; and to come to an 
operational decision or recommendation, after weighing the major 
alternative courses of action. I stress the word "practical" because 
I do not want this to be interpreted to mean only textbook problem- 
solving at the grand top-management policy level, although the 
general procedures there are very much the same. Good business 
school training, I should think, would strive to develop this kind 
of practical problem-solving ability. It would focus on a wide range 
of problems, from small, low-level situations, to at least some 
simulated experience at the general business policy level where the 
issues are bigger and more complex. It is clear that such problem- 
solving ability can be developed — we do it in business all the time. 
The business schools should accept a major responsibility here. 
Most important to such practical problem-solving is training in 
recognizing the important differences between facts, assumptions 
and judgments. 

Second, no matter how good a man's ideas are, if he can't com- 
municate them effectively they won't be much good either to him 
or to the business for which he works. This is, by now, a very trite 
proposition. But I know of few others as important. One of the 
greatest weaknesses in our executives at all levels is their utter 
inability to state clearly and understandably in writing the nature 
of a business problem, what they want to do about it and why. 

Communication is essential to getting things done effectively 
in the business world where, for the most part, we only get things 
done through working with other people. I could put my point 
more broadly and stress the ability to work effectively with others. 
But I want to emphasize the ability to communicate through the 
written and the spoken word by singling it out in this way. We 
have a right to expect the business schools to do a much better job 
than they seem to be doing on this score. You can't leave it up to 
the English Department. 



16 FRED C. FOY 

Third, we have a right to expect you to produce potential busi- 
nessmen who understand something about how the American eco- 
nomic system operates and are able to explain it. It is my observation 
that the rules on which our economic system is based vary, de- 
pending on what economist states them. This is understandable 
since Economics is not an exact science and always has been based 
on the professional economist's attempts to explain what has hap- 
pened. 

I think it is important therefore for all business school students 
to be exposed to the differing theories existent in the field; that they 
be encouraged to form their own judgments as to which appear to 
be most valid. Unfortunately, much economics seems to have been 
taught on a "this is so" basis. 

Fourth, what do I mean when I say we have a right to expect 
a basic understanding of the practical areas of business, such as 
marketing, finance, and purchasing? I mean that the business school 
graduate should know enough about these major functional areas 
to be able to walk into the day-to-day business world, understanding 
that these specialized areas exist, why and what are the yardsticks, 
measuring points and controls by which progress in them is judged. 

Conversely, I do not mean that he should have a long string 
of courses in any of these areas, especially to the exclusion of the 
others. I'm not even sure that he needs a special course in each 
of the functional areas of business. But he certainly does need to 
be exposed to some of the main problems in the various areas in a 
practical way. This seems to me highly consistent with my first 
point, that he should learn how to be a practical problem-solver. 
For experience in solving problems in business can be spread over 
many areas within business so the educational process can be killing 
both birds with the same stone. 

I have said nothing about whether this training is for big busi- 
ness or for little business. In fact, most business school graduates 
will end up in small or middle-sized firms. Especially in such firms 
I would suppose that a fairly general training, with emphasis on 
the qualities above, would be particularly valuable. Even in big 
business, where the man usually starts out in a rather specialized 



A Businessman Looks at Business Education 17 

job, these broad qualities are the ones that I think will give him 
the greatest flexibility and adaptability to do the job well and to grow 
into other jobs. 

One last comment on the kind of student we have a right to 
expect from you. Above all, he has to be a student who keeps 
on learning after he leaves the campus. The world is changing so 
fast that no business school can hope to teach more than a small 
fraction of what today's student will need to know over the next 
forty years — his probable working life. Yet I was struck by the 
fact that only Dean Bach of Carnegie Tech, in his chapter in the 
Pierson volume, put major stress on looking two or three decades 
ahead and giving the student primarily the foundation for continuing 
to learn and adapt over that long period. As an operating business- 
man, I know that today is important. But surely business education 
must put high on its list the ability to adapt to the changing world 
of the 1970's and 1980's, which will be only the middle of the adult 
life of the business school students of today. 

Next, what do we have a right to expect in the way of curri- 
culum and teaching methods in the business schools? 

Here, I don't believe that a businessman has much to say about 
how educators can do their own job best. But there are a few 
implications of my suggestions above on which I'd like to comment 
briefly. 

The Business School Graduate 

I began with a list of personal qualities I'd like to see in students 
coming out of the business schools. One of these was breadth and 
imagination. Another was adaptability. Thus, I like the general 
flavor of the Gordon-Howell and Pierson reports in their stress 
on providing a sound, wide-ranging general education, as well as 
some specific focus on business. The mixture of an undergraduate 
degree in liberal arts, especially a good program in economics, 
plus graduate education in business, looks good for the better stu- 
dents who can afford this much time. A combination of under- 
graduate engineering with graduate business training offers parallel 



18 FRED C. FOY 

attractions, though there is danger here that breadth of education 
may be sacrificed. 

But surely the mass problem will lie at the undergraduate level, 
at least for a good many years to come. Here, I agree with the 
authors of the two reports that well under half the total under- 
graduate curriculum needs to be devoted to technical business 
courses. We need only a modest amount of detailed specialization, 
even for those undergraduates who show no real promise of rising 
to top management positions. The "core" curricula suggested in 
both books look sensible to me. Certainly I wouldn't go further 
toward specialization. Some of the narrowly detailed business 
courses I've heard of horrify me. More often than not, at least in 
businesses like mine, we feel we can teach the routine skills better 
than the business schools can. And such skills generally don't take 
very long to learn. We'd rather have stress in the business schools 
on the more fundamental qualities I outlined above. Fortunately, 
this leaves plenty of time for a good broad education in the liberal 
arts. 

But as a liberal arts graduate myself, I know that merely to 
call a course liberal arts does not necessarily mean it is good edu- 
cation or even very "liberal". What a man learns from a course 
surely depends more on the content of the course and how it is 
taught than on its name and where it is located on the campus. 

The Importance of Good Teaching 

This brings me to my second general point about curriculum 
and teaching methods. I suspect that if I had been writing one 
of the reports, I would have put more stress on the role of the 
individual teacher and on the importance of good teaching methods 
and procedures — as compared to the emphasis on curriculum and 
formal administrative arrangements. No matter what a course is 
labeled, a good teacher who stresses independent thinking — the 
practical problem-solving that I emphasized above — can make it a 
significant educational experience. The most grandiose title in the 
world doesn't help if the teacher just repeats a description of current 



A Businessman Looks at Business Education 19 

business practice from the textbook. If the implications of the 
Gordon-Howell and Pierson reports are correct, business has a right 
to expect better and more fundamental teaching than is being done 
in many of the business schools today. By "better and more funda- 
mental teaching" I would suggest two specific areas for considera- 
tion. 

First — don't most liberal arts courses lend themselves to thought 
and imagination stimulation of a type that the student will need 
later? Can history be taught not only on a "what happened and 
what caused it to happen" basis, but on a "what might have hap- 
pened instead and what would have eventuated if it had"? The 
businessman in a position of responsibility is constantly having to 
follow current history in the newspapers and magazines today in 
order to determine what impact events may have on his business 
tomorrow. 

Second — may I define education as knowledge that can be put 
to work? If so, may I suggest the abolition of all closed-book exami- 
nations? After all, there are no closed-book exams in business or 
the world. We are interested not in how much knowledge is stored 
in a man's head, but in his practical ability to tap all sources of 
information leading to the successful solution of a problem. Exami- 
nations should test his ability to do this, not to recite. 

My third general point is that we have a right to expect more 
intellectual leadership and vitality from the business schools than 
we are getting. 

The Importance of Research 

Above all, the function of the outstanding university is to pro- 
vide intellectual leadership — to suggest new ideas, to question, to 
probe. The world of affairs often criticizes the "long-hairs" in uni- 
versities and the "unrealistic" ideas that come out of university 
research. But it is this research, and this questioning attitude, that 
have given the world many of its greatest advancements. And the 
strong support in the American way of life for the private university 
is clear evidence of the respect the American public has for advanced 



20 FRED C. FOY 

education and research. And, I hardly need add, by American busi- 
ness, ii you look at the large contributions we make annually to the 
nation's colleges and universities. 

Yet, it Gordon-Howell, and Pierson are right, there is little 
evidence of this intellectual ferment and of this leadership in the 
business schools. And I must affirm this conclusion from my own 
limited personal observation — with some exceptions in the business 
school community. 

The business schools should offer an exciting environment for 
the best academic minds and the best young students. Much busi- 
ness school teaching surely has to be teaching the best of current 
business practice. But the outstanding business school cannot be 
content with this. It must continually strive to be ahead of the best 
current practice — to be probing and suggesting new ways of look- 
ing at problems, ways of doing things better. The parallel of funda- 
mental research in the physical sciences and in mathematics in 
relation to modern engineering can be cited. The similar parallel 
of basic scientific research underlying the professional practice of 
medicine may also be relevant. 

I contrast this type of research with mere description of how 
business firms are doing things now. 

Perhaps I am asking too much. Basic research in the field 
of business is, I suspect, extremely difficult. But let me suggest two 
or three questions on which fundamental research might help to 
throw light over the years ahead, just as examples. We surely need 
to understand better human behavior in business organizations. 
For example, we know all too little about how "influence" is really 
exerted, far too little about the significance of different types of 
communication channels in making business organizations work well 
or badly. We need to know much more about the possible usefulness 
of mathematical models in relation to the use of modern computers 
for solving a wide range of middle-management problems where 
present procedures are based on inadequate information and rules 
of thumb. Research on problems like these won't turn up usable 
answers tomororw. But neither does research on many problems 
in theoretical physics. 



A Businessman Looks at Business Education 21 

But, as I indicated above, to do fundamental research on busi- 
ness problems is, I am sure, hard. For most business schools, much 
research of this sort is probably out of the question — because it is 
expensive and slow, and because it requires extremely imaginative 
and highly skilled research personnel. Possibly such research must 
be limited to a mere handful of the leading business schools. But 
this does not mean that we in business should not expect research 
and a lively spirit of inquiry and alertness on other campuses too. 
Research, case collection, and consulting in industry are valuable 
partly because they may turn up new knowledge to be taught. But 
they are equally valuable in keeping teachers alive and stimulated. 
And any business school can reasonably be expected to push hard on 
the latter score. Without lively, up-to-date teachers there will be few 
lively, imaginative students. 

A research problem need not be fundamental or grandiose to 
be useful for this purpose. For example, a study of local labor supply 
conditions and of labor mobility among jobs hardly seems out of 
the question for even a small school. Other such problems come 
readily to mind. More generally, why can't many of the business 
schools fulfill a useful function by working with business to see 
how some of the new fundamental research done over the last decade 
can be interpreted and applied in different business firms? I recog- 
nize that not every business school can be a national leader. But 
unless a business school works hard at keeping up with the latest 
developments, its faculty is likely to stagnate and its students will 
fall increasingly short of their best potential for careers in business. 

A Challenge to the Business School 

Let me conclude with a friendly challenge. In a recent discussion 
between a group of business educators and businessmen, some of 
the educators complained. They pointed out that although busi- 
ness generously supports university work in engineering and science 
and the liberal arts, it gives virtually nothing directly for the sup- 
port of the business schools. Yet the business schools are set up to 
provide students specifically for the world of business. Why, the 



22 FRED C. FOY 

educators asked, don't you put up some money to support the business 
schools which operate specifically to help you? 

Frankly, most of the businessmen were surprised to realize how 
little financial support the business schools are getting from Ameri- 
can business today. But basically their answer was this. First, why 
don't you in the business schools do a more effective job of asking 
for financial aid? We haven't had a good case made by the business 
schools comparable to the need established by engineering and sci- 
ence and the liberal arts — at least not yet. But second, you just 
haven't shown the kind of leadership in business education and busi- 
ness research that would justify our pouring large sums of money into 
support of business education, comparable to the support we are 
giving other areas of education. 

These were harsh words. But they were said with a friendly 
voice. The firmer the sense of direction, and the wider the evidences 
of real leadership in the business schools, the easier it will be for you 
to get the moral and financial support you need to do the enormous 
job that faces you over the decades ahead. Most businessmen are 
friendly toward business education. But if you are to get the help 
and support you need, it's up to you to show you really deserve it 
in a highly competitive world. 



Education for 
Business Management 



BY RICHARD M. PAGET 

Partner 
Cresap, McCormick and Paget 



.Lor more than two years it has been my pleasure to head a 
committee of the Association of Consulting Management Engineers 
charged with the task of examining the Education and Training of 
Management Consultants. While our deliberations are by no means 
at an end, you may be interested in some of our tentative observa- 
tions and conclusions. There is no present agreement among us that 
a business school education is essential to a successful consulting 
career — any more than we believe it to be a requirement for the 
education of the successful manager in business. There is agree- 
ment that college work in business, preferably at the graduate level, 
may be a wise choice for those now entering colleges and univer- 
sities who wish eventually to enter the consulting profession. 

No attempt has been made to deal specifically with curriculum 
content. However, there is a very strong feeling that a foundation 
in general education, supplemented by business education, particular- 
ly in the nature and operation of the processes of management, 
management accounting, finance and marketing, provides the most 
useful educational base for a consulting career. There is an equally 
strong opinion that many of the highly specialized tool courses and 
courses oriented toward preparation for specific careers are of little 
value. 

We have been experimenting with a study of the ways in which 
those people who are successful in our profession have been educated 
and what they think of their education. This admittedly incomplete 
study of education for management consulting as seen through the 
eyes of those who practice the profession has produced a strong con- 



26 RICHARD M. PAGET 

sensus of opinion that the preferred education for consulting will 
be found in any curriculum which is oriented toward the liberal 
tradition in education. Where the course offerings and teaching 
methods of the business school foster an objective and critical atti- 
tude; orderly thinking processes; an understanding of the totality of 
the subject matter; and develop ability to communicate orally and 
in writing, there is a bias in favor of this type of education. But 
there are strong opinions that the business schools in the past gen- 
erally have not been the best sources of education in the liberal 
tradition. 

This is not to indicate an unfriendly or negative attitude toward 
business education. I believe it merely indicates that the critical 
examination you are making of yourselves is timely and construc- 
tive. 

In this period of self-examination, you are fortunate to have 
the studies of Professors Gordon and Howell and Professor Pierson. 
My committee considers these books the most stimulating analyses 
we have encountered on the subject of education for business. As 
you can see already, we agree with many of the important observa- 
tions and basic conclusions of both studies. The authors have been 
penetrating in their analysis of problems, temperate in criticism of 
existing conditions, constructive in proposals for improvement, 
honest in revealing the limitations of the underlying research and 
specific in suggestions for change. Both books must be recognized 
as contributions of vital significance to the ultimate improvement 
of education for business. 

While our group has been concerned primarily with education 
for management consulting, we have been equally concerned with 
education for business management. The management consultant 
supplements the work of the manager. He has joined with the 
manager over the years to develop many of the accepted techniques 
of business management. The management consultant and the 
manager are very similar individuals and the roles interchange today 
with increasing frequency. The background required for manage- 
ment and management consulting is also interchangeable. 



Education for Business Management 27 

With the able assistance of the Executive Secretary of the Asso- 
ciation of Consulting Management Engineers, Mr. Philip Shay, our 
committee has given priority in its studies of education for business 
to an examination of the nature of the business enterprise, the role 
of the manager in business and the primary object of business edu- 
cation. Only then have we tried to define a rational theory for busi- 
ness management to determine whether education for business man- 
agement is even possible. For unless there can be evolved a genuine 
discipline of business enterprise and its management with its own 
organized, systematic body of knowledge, its own theory and meth- 
ods of hypothesis, analysis and verification suited to its own uses, 
business cannot be an important field of educational interest. 

In my remarks today I draw heavily on the preliminary work 
of our ACME committee, and on the writings of many businessmen 
and teachers who have been thinking in this field. I claim little 
originality for the ideas which I am about to express, but I do be- 
lieve these observations to be true and only wish we had time to 
do more than sketch an outline of some of the important concepts. 

The Nature of the 

Business Enterprise 

In considering the nature of the business enterprise we recognize 
that private business enterprise, as it has been developed to its high- 
est level of sophistication in the United States, is a unique institution 
through which our society has learned to organize physical assets, 
capital and human resources to produce economic goods and services. 
This is done so as to strengthen society and in accordance with its 
political and ethical beliefs. While these are important conditions 
surrounding the ways in which business enterprise functions, in the 
final analysis economic performance is the feature which sets busi- 
ness enterprise apart from all other social institutions. 

Business enterprise has no economic existence without individuals 
who make management decisions, take management actions and 
follow a definable pattern of management behavior. And since the 
manager is so obviously the specific organ of the business enter- 



28 RICHARD M. PAGET 

prise, he must give first consideration to economic performance in 
every decision and action. These decisions and actions may result in 
great social good or create happiness among those associated with 
the enterprise. But if the manager does not maintain and increase 
the wealth-producing capacity of the economic resources of the 
business enterprise, he has failed in his primary responsibility. 

The Economic Nature of the Role of 

Management in the Business Enterprise 

In examining the role of management in its relation to the busi- 
ness enterprise, it is axiomatic that the ultimate health and sur- 
vival of a business depends to an infinitely greater extent on the 
caliber of its management than on any other factor. In 25 years of 
management consulting experience I have yet to encounter any 
business in serious difficulty if the business has had good top man- 
agement during the five preceding years. 

But management of business enterprise, as is recognized in both 
the Ford and Carnegie studies, is not a function reserved solely for 
those at the top of the business organization structure. Management 
is the job of decision making and decision implementation. It is 
carried out at every level of line and staff supervision and even in 
numerous positions where supervision of others is not an element. 
The basic differentiations in the levels of management arise primarily 
from the scope of the decisions to be made and the degree to which 
their implementation can favorably or adversely affect the business 
as a whole. 

The Object of the 

Collegiate School of Business 

The principal need of the business enterprise, at all levels of line 
and staff work, is for people capable of managing. Preparation of 
students for decision making and decision implementation, in my 
opinion, is the proper object for the collegiate school of business 
administration at the graduate or undergraduate level. 



Education for Business Management 29 

Some will object to this object as limiting the usefulness of 
schools of business to the many who seek business education. Too 
much time and energy already has been devoted to arguing whether 
the role of the business school is to be limited to that of giving broad 
preparation for careers as top managers and whether business edu- 
cation should be offered only at the graduate level. Both of the 
reports you have been considering very wisely recognize there are 
wide differences in the basic abilities, economic circumstances and 
preparation for college of students who attend our graduate and 
undergraduate business schools. All managers in business cannot be 
top executives and business needs managers with widely varying 
competences, capable of handling various levels of responsibility. 
There should be room in the business school curriculum to prepare 
students with divergent capacities and ambitions eventually to make 
better management decisions and to implement more skillfully 
these decisions at all management levels in business. There is a 
legitimate place for a variety of levels and approaches to education 
among the schools of business. 

The Emerging Discipline of the Business Enterprise 

To appraise the educational implications of teaching manage- 
ment, we must make a brief effort to determine whether there 
is any possibility of defining a discipline for the business enterprise 
leading to an understanding of the rational nature of management 
action. For unless there is some logical and relevant theory of busi- 
ness management, it cannot be taught, learned, researched, recorded 
or practiced. 

A number of modern thinkers in schools of business and in 
industry have been proposing a discipline of the business enterprise 
predicated on an examination of those things which have to be, 
to be done, to be achieved for a business enterprise to continue to 
exist at all. 

There appear to be at least Eve areas in which each business has 
to set objectives, obtain satisfactory standards of performance and 
achieve results if it is to survive in our society: 



30 RICHARD M. PAGET 

1. First, a business requires a human organization, capable of 
joint performance and of self -perpetuation. 

This requirement that the business enterprise have an effective 
human organization is so generally accepted as to require no lengthy 
comment. That this same organization must be capable of self- 
perpetuation is recognized but not so universally accepted. The 
management development programs of the business schools find 
their most logical reason for being in furtherance of this first re- 
quirement for the existence of the business enterprise. 

2. Second, a business must be conducted to exist within the 
opportunities and restrictions of the social, economic and political 
climate existing now and in the future. 

That business is dependent for survival on anticipation of social 
climate, economic policy and political action has been dramatized 
most recently in the actions of the present Cuban government and 
in the current investigation of the ethical drug industry. Every 
business is at the mercy of changes in spendable income, population 
trends, changing values and ways of life. The enterprise must be 
managed to live with and adjust to the "non-market" influences 
as defined in the Ford study. 

3. Third, as already mentioned, the specific purpose of business 
is economic in nature. 

Business enterprise, as we know it in a capitalistic society, has 
survived because it has been the best way of supplying economic 
goods and services. No other political or economic system does the 
job so efficiently and economically. Private business enterprise will 
survive as long as it continues to justify its existence through eco- 
nomic performance. 

4. Fourth, business enterprise is unique in the fact that it is the 
only major social institution designed to create change or to innovate. 

The business which fails to change — "to keep up with the times" 
— to develop new technologies and new techniques in marketing, 
finance, and other functions, is accorded skeptical comment by the 
professional security analysts! Sears Roebuck, duPont, Koppers, 



Education for Business Management 31 

American Telephone and IBM are highly regarded primarily be- 
cause they are known to be innovators, to be organizations capable 
of bringing about the new. 

5. Fifth, business enterprise is dependent upon profits adequate 
to meet the ultimate costs of its risks. 

It is the essential nature of the business enterprise to take and 
to generate risks. By its very nature, "risk" implies losses of capital 
in the near or far term future. Unless business can generate profits 
adequate to its risks, wealth is impaired and the business system fails. 

We are not considering the distribution of profits to those who 
own, manage or work in the enterprise. We are simply stating that 
the need for profit in business is objective — it is a legitimate claim 
of the enterprise. 

All management decisions and actions must be guided by at 
least these five characteristic survival objectives of the business enter- 
prise — the need for a self -perpetuating human organization; the 
need to exist within a changing social, economic and political cli- 
mate; the need for emphasis on economic performance; the need for 
being an instrument for change or innovation; and the need for 
profit to offset the costs of risk. Every management decision must 
take into account the requirements and opportunities in each of 
these survival objectives. They are mutually interdependent, but 
unsatisfactory results in any one of these areas cannot be offset by 
outstanding performance in any of the others. 

This is another way of saying that business enterprise must have 
multiple objectives covering human organization, external factors, 
economic performance, innovation and profits. There are many 
examples of the collapse of enterprises which have not recognized 
the complex, multidimensional nature of their objectives. 

Thus there is the very real possibility that through the develop- 
ment of understanding in these five, or more, areas of basic objectives 
we may be approaching a discipline of business management which 
has genuine substance and which can be taught with increasing ef- 
fectiveness. The development of this discipline, as yet imperfectly 
defined and less perfectly understood will come from a combination 
of the kinds of research in schools of business for which both the 



32 RICHARD M. PAGET 

Ford and Carnegie studies make such eloquent pleas, the contribu- 
tions to be made by individual scholars here and abroad, the experi- 
mentation of managers, and a resurgence of contribution to knowl- 
edge of business from the management consultants. 

Management as a Rational Process 

The business enterprise is an ineffective, inarticulate and utterly 
useless institution without management to guide it at every step. 
When this guidance is accomplished through the use of all available 
mathematical and nonmathematical tools for measuring conditions 
and possibilities, management can be said to be using scientific meth- 
ods. The further development of methods to help the manager 
discover all of the alternatives, appraise the risks, measure perform- 
ance and visualize the future possibilities is the future of manage- 
ment science. This also represents an important part of the future 
of the collegiate school of business. 

Decision making — at the most simple or most complex level — 
pre-supposes a willingness to define and prescribe a course of action. 
If decision making — or management — is essentially the result of 
defining and evaluating objectives, assumptions and risks affecting 
the five survival objectives identified as a discipline of the business 
enterprise, we begin to recognize something which has been accepted 
for a long time by mature businessmen and members of business 
school faculties: that business management is a much more rational 
process than generally has been admitted. In practice, competent 
businessmen do not act blindly or by Divine Right. Decisions and 
actions of managers to quote Philip Shay, "are based on certain 
definite ideas regarding the nature of the business they manage, 
the nature of the market and the economy in which they operate, the 
nature and limitations of the resources at their disposal, and the 
effects of their actions upon the business and upon people outside 
the business." 

It would be a most grievous error to disregard the importance 
of experience or intuition in the making of business decisions. It is 
not for capricious reasons that well educated young men seldom 



Education for Business Management 33 

are given major business management responsibilities until they have 
acquired additional empirical knowledge and have had the privilege 
of making some mistakes. However, the young man who under- 
stands the rationale of business management and has been given — 
to quote Professor Pierson — "certain essential tools and knowledge 
of subject matter" should be more rapidly capable of undertaking 
decision making at progressively complex levels. 

The implementing of decisions once made is again a process 
which may be done "intuitively" by the "natural leader" or which 
may be done even more effectively by the leader who understands 
how to communicate ideas, motivate others to action and establish 
meaningful goals and measurements of performance against them. 
Making decisions for action is hard enough but causing these pro- 
posed actions to become realities in the business enterprise is fre- 
quently even more difficult. 

Here is an area where the business school can have a profound 
influence in improving the competence of management of the busi- 
ness enterprise. Students must be made to see that managers have 
done only part of their job when they have identified problems and 
developed the solutions. As a consultant, I speak on this point with 
real feeling. The world's finest job of problem analysis and solution 
development is of small value if it is not or cannot be applied. 

Implications for the Educational Role 

of the Collegiate School of Business 

Fortunately for our peace of mind, nothing I have outlined here 
suggests any radically new or as yet unproposed approach to col- 
legiate education for business. 

All of this argues for the validity of many of the major con- 
clusions and recommendations in the Ford and Carnegie studies: 
more credit hours in General Education, a tightening of standards 
of admission and of scholastic performance, reductions in course 
offerings and fields of specialization, less emphasis on courses to 
develop simple business skills, increased emphasis on an under- 
standing of the processes of management decision making and man- 



34 RICHARD M. PAGET 

agement action and a recognition of the genuine need for higher 
quality and more significant research activity in schools of business 
with this capability. The requirement is for business education or- 
ganized and taught in the liberal tradition. 

Competence in business management comes from a combination 
of personal qualifications, knowledge, practical experience and the 
capacity for disciplined reasoning. The schools o£ business have an 
obligation to contribute to each of the elements in this competence. 

Experience is difficult to transmit through simulation. Harvard's 
initial advocacy of the case method of instruction and the exhaustive, 
meticulous preparation of case materials in that school and in several 
others seem most worthwhile. Critical as some may be of consulting 
obligations assumed by faculty members, these activities also provide 
a way of bringing practical experience to the classroom. Internships, 
the use of businessmen as lecturers, advisers and critics, and the actual 
observation by students of business decisions and actions at various 
management levels can contribute to realism. No one expects the 
business school to provide the student with much meaningful ex- 
perience. All that can be done is to make him receptive to learning 
through the experiences he will have in his subsequent business 
career. 

The business school can make a more direct contribution to the 
development of the personal qualities which the student must 
have in some degree if his business career is to include accomplish- 
ment as a manager or as a teacher. Communication abilities, ethical 
concepts, an interest in continuing the processes of learning, intel- 
lectual curiosity and understanding of interpersonal relationships 
are some of the personal qualities which can be developed by the 
business school experience. 

It requires a more competent pedagogue than I to know whether 
there is much educational value in transmitting factual knowledge. 
However, it would seem proper to argue that some basic concepts, 
factual background, terminology and an acquaintance with the com- 
mon and specialized fact-finding tools of business will be useful to 
the student. While I may no longer remember Fred Clark's seven 
principles of stimulating salesmen to greater efforts, I did learn 



Education for Business Management 35 

salesmen should be stimulated! Much of the knowledge which will 
be used by most students after they become managers will be de- 
rived from study and observation of the particular business environ- 
ment in which they are functioning. However, it is hard to visualize 
a school of business at the graduate or undergraduate level which 
does not offer some courses for the primary purpose of conveying 
knowledge. 

Perhaps the place where the school of business can make its 
most effective and unique contribution to education for business 
is in the development of the capacity to reason logically, precisely 
and creatively about business problems. Here is where background 
in general education is related to the special circumstances of the 
business enterprise. Here is where the heritage of logic, the analytical 
process, the capacity to recognize and respect factual evidence, and 
the understanding of the processes of synthesizing conclusions are 
focused toward their uses in the management of business enterprise. 

There are seven pages in Professor Pierson's book — pages 86 
through 93 — in which he summarizes "The Elements in Business 
Careers" and "The Evolving Social Environment" of business enter- 
prise. These are the most telling and the most important pages in 
either of these recent studies. It would be difficult to add to his con- 
clusion when, speaking about the development of the capacity for 
reasoning about business operating questions, he states: "the under- 
lying capacity required, however, is potentially useful in all jobs 
and careers in business, and the prime task of business schools is 
to foster it in every possible way." 



Liberal Education 
for Business 



BY HOWARD G. BOWEN 

President 
Grinnell College 



I 



suspect that those who planned these papers had it in 
mind that I might consider the place of collegiate education for 
business in the operations of a liberal arts college. This, at least, 
is the view of the matter which I shall take at this time. 

It has occurred to me that you have just read 1,231 closely- 
packed pages by Gordon-Howell and Pierson, and that you may 
not feel the need just now of comments by another such person. 
Perhaps I can be tolerated because I have spent much of my career 
in business schools, and my thinking has been strongly influenced 
by that experience. At any rate, I hold the view that the liberal arts 
college and the business school both have much to contribute to the 
education of businessmen and I see them as closely-related partners 
in business education. I see them, also, though this is less obvious, 
as partners in liberal education. 

One preliminary clarification. The scope of higher education 
for business is extremely broad. It extends in subject matter from 
typing to top management, and in academic level from junior 
college to Ph.D. My discussion will refer to four-year undergraduate 
education designed to prepare for the "higher" or executive careers 
in such areas as production, marketing, personnel, finance, account- 
ing, and administration. 

Business Education and the Arts and Sciences 

As I reflect on the persistent debate over business education, it 
seems clear that a central issue is the relationship between the arts 
and sciences and the business studies. Questions such as these are 



40 HOWARD G.BOWEN 

raised: (1) What should be the relative weight given to the arts 
and sciences and to the business studies? (2) What courses in the 
arts and sciences are necessary or desirable? (3) At what point in 
his career should the student begin his business studies and at what 
point should he be formally admitted to the business school? (4) 
Should business courses be more or less technical or vocational? 

Business is not the only professional field in which these questions 
are being debated. The same questions are being considered with 
reference to medicine, dentistry, law, theology, education, engineer- 
ing, architecture, and even pharmacy. Too often, I am afraid, these 
questions are being debated in relatively sterile concepts like credit 
hours and course titles rather than in the more significant categories 
of subject matter, point of view, and intellectual spirit. Neverthe- 
less, these are the questions of general concern. 

In the case of business education, the issues have become more 
insistent in recent years because business itself has been changing 
and the educational demands upon businessmen have been rapidly 
increasing and broadening. Major recommendations of most of the 
critics of the business schools (including Gordon, Howell, and 
Pierson) have been that more weight should be given to courses 
in the arts and sciences and that courses in business should become 
less technical and vocational and more liberal in spirit. The case 
for increasing the relative weight given to the arts and sciences has 
become overwhelming. In a sense, many of/the fields we used to 
think of as predominantly non-vocational^/and which were offered 
mainly as part of general education, have become down-to-earth 
practical for anyone contemplating a business career. Science and 
mathematics are surely as relevant today as salesmanship or insur- 
ance; psychology and sociology are as fitting as investments or time 
and motion study; history and government are as appropriate as 
advertising or corporation finance; English, speech, and foreign 
languages may be as useful as statistics or business law; etc. Even 
the humanities — fields such as philosophy, ethics, art, and literature 
are relevant to the education of persons who will need human under- 
standing and who will be called upon to consider social obligations 
in their daily tasks. Indeed, it is hard to find a subject among all the 



Liberal Education for Business 41 

arts and sciences that has no bearing upon preparation for business 
careers. Everyone has long recognized the relevance of economics, but 
economics surely does not stand alone among the liberal subjects 
that are directly related to business. In my opinion, economics does 
not deserve preeminence over many other fields. 

All this adds up to the conclusion that education in the arts and 
sciences is an indispensable preparation for business careers, and that 
most business students have not given the attention to these fields 
that they deserve. 

It seems fairly well established, also, that work in the arts and 
sciences should be in basic rather than applied courses. The psy- 
chology of advertising is not an adequate substitute for psychology, 
the mathematics of finance does not replace the calculus, govern- 
ment and business does not replace political theory, a course in 
scientific research for business does not replace a course in chemis- 
try. Further, merely to require a scattering of introductory survey 
courses in a wide range of liberal fields does not meet the need. 
There must be some depth and some understanding. 

The problem of how to incorporate the necessary arts and 
sciences and still to include a respectable offering of business studies 
is at the heart of the problem. The easy answer, and probably in the 
long run the correct answer, is that it is not possible to give a good 
general education and a good professional education in four years. 
It does not necessarily follow from this that business subjects 
should be confined to the graduate years, but it does follow that a 
sound degree in business probably requires more than four years of 
college work. It is usually assumed, however, that the majority 
of our customers are not yet ready for five or six years of higher 
education and that some combination of business studies and the 
arts and sciences must be provided that will lead to a four-year 
degree. I think this assumption should not be made too easily, and 
that more students than we think would accept the longer program. 
Yet, I must concede that the four-year business degree will for 
many years be necessary in many universities. Having conceded this, 
however, it seems to me that much more than half, possibly three- 
fourths, of the four-year program might well be devoted to the arts 



42 HOWARD G.BOWEN 

and sciences. Moreover, it seems to me that we should not presume 
that every student headed toward a business career would be in the 
business school. Many would be well-advised to major in mathe- 
matics or psyschology or political science or chemistry. All or most, 
however, would take some courses in business. Those students who 
wished to go into business subjects in depth or who wished to pre- 
pare themselves in technical business fields would do so in graduate 
study or in later adult education programs. 

The position I have taken is hardly novel, and it might even be 
non-controversial if the liberal arts colleges were actually equipped 
to give the kinds of programs in the arts and sciences needed to 
prepare businessmen. Unfortunately, as we all know, many courses 
in liberal arts colleges are narrow, technical, pedantic, bound by 
tradition, irrelevant, or superficial. These are big generalizations, 
and they surely do not apply to every liberal arts college or to every 
course in any liberal arts college. But these generalizations are at 
least as valid as the big generalization made by the critics of the 
business schools. My purpose is not to offer recriminations, but to 
point out that the acute problems of undergradaute business edu- 
cation are found in the liberal arts college as well as in the business 
school. The biggest task of the business dean is to find ways to get 
appropriate education for business students in the arts and sciences. 
To do this, he must become deeply concerned about what happens 
to his students in their courses in the arts and sciences. He must 
use his influence in the councils of the university to see that appro- 
priate courses are available and are taken by his students. Maximum 
progress toward a broadly educated business leadership cannot be 
achieved even with the best of intentions, if students are given 
literature courses emphasizing the use of the participle in Shake- 
speare, or are given history courses dwelling on battles and dynasties, 
or take conventional mathematics courses that were designed for 
engineers in 1910, or study psychology that is confined to the condi- 
tioned reflex, or take biology that involves only memory of great 
quantities of Latin nomenclature. There is no need to dwell on this 
matter except to say that the business dean of the future must become 



Liberal Education for Business 43 

one of the leaders in the university in the advocacy of true liberal 
education. Only if this kind of education is attainable can he achieve 
his main objective of sound training for business. 

In planning the education of his students, the business dean 
must also take a close interest in the selection of courses in the arts 
and sciences. It is not enough to define the program merely in terms 
of a given number of credits or of some mechanical distribution of 
courses among fields. Courses in the arts and sciences must be care- 
fully selected in terms of the interests and career objectives of stu- 
dents. This, of course, involves cooperation between the business 
school and the liberal arts college. In short, I believe that business 
education is inescapably a joint activity of the liberal arts college 
and the business school, and that there must be much more coopera- 
tion between the two units in educational planning than has been 
common in the past. It seems to me that it would be desirable also 
for presidents or provosts to become concerned about the role of 
the liberal arts college in professional education. Perhaps also, joint 
committees representing business schools and liberal arts colleges 
should be formed to deal with the questions I have raised. 

One tempting solution to the problem is to take over the teaching 
of the necessary arts and sciences for business students in the business 
school. Experience suggests, I think, that this is not a satisfactory 
solution. It is difficult for the business school to attract competent 
staff for the purpose, and generally business school courses in the 
arts and sciences have a way of becoming too narrowly related to 
business. However, it is a solution, and desperation (or the need 
for bargaining strength) may dictate it. 

The Need for Flexibility in Student Programs 

Another important consideration is that a young student's pro- 
gram should be planned so that he can easily change his career 
objective and his educational program in midstream. One of the 
purposes of college is to help students find themselves, and they 
should not be irrevocably locked into a major field or a particular 
administrative division. This consideration suggests either that stu- 



44 HOWARD G.BOWEN 

dents should not enter the business school before the junior year 
or that there be provision for easy movement of students back and 
forth between the college of arts and sciences and the business 
school. 

Liberal Business Education 

I share the view expressed by Gordon-Howell and Pierson that busi- 
ness subjects offered undergraduates should on the whole be liberal in 
orientation. They should help students gain an understanding of 
business as one of the central institutions of our society, and give 
them perspective on the relation of business to the social environ- 
ment in which it operates. With few exceptions, undergraduate 
business courses should not be technical or directly vocational. Many 
business school courses today are in every sense liberal. One of the 
most pernicious misconceptions is that because a course is offered in 
a business school it is therefore not liberal. (As I have already indi- 
cated, the opposite misconception is even more pernicious, namely, 
that because a course is offered in the liberal arts college it is there- 
fore liberal.) 

In closing, I should like to outline an experiment in business 
education in a liberal arts setting that has been conducted at Grinnell 
College with the assistance of the Ford Foundation. I relate this 
experience because I think k may have some relevance to the under- 
graduate business school. This experiment was based on two assump- 
tions. The first was that education in the sciences and arts involving 
any of a wide range of majors is appropriate for careers in business. 
The second assumption was that business is surely as worthy of 
study in a liberal arts college as any other social institution such as 
the family, the church, or the state. With these two assumptions in 
mind, all of the conventional business courses that had crept into 
the curriculum and survived past pruning were dropped. In their 
place five new courses of one-semester each were added. Each of the 
new courses was designed to convey understanding of business as 
an important feature of our society. Each course was open to all 
students having suitable prerequisites regardless of their majors or 
their career interests. 



Liberal Education for Business 45 

I shall identify and describe very briefly the five courses. (1) 
Accounting is a one-semester course with emphasis on theory and 
interpretation. It is not a first course in the training of an accountant 
but rather a course to acquaint the student with the one of the 
important languages of our civilization having its own grammar, 
syntax, and semantic problems. (2) The Capital Market considers 
the nature of capital; the supply of capital as derived from personal 
saving, corporate saving, and credit expansion; the various sources of 
demand for capital; the financial institutions that mediate between 
the supply and the demand; and the determination of interest rates. 
(3) Industrial Organization is concerned with the technical aspects 
of production including such topics as technology, size of plant and 
size of firm, factors in centralization and decentralization of firms, 
and location of industry. (4) The Business Enterprise deals with 
legal status, internal organization and control, motivation, expecta- 
tions and planning, and social control. ( 5 ) Administration is a study 
of the administrative process applicable not only to business but 
also to government, churches, universities, and all other organiza- 
tions. 

To repeat, each of these courses is consistent with the spirit of 
a liberal arts college. The purpose of each is to give understanding 
of and perspective on an important sector of contemporary society. 

A faculty member was designated to serve as adviser for students 
interested in business careers. His function is exactly like that of 
similar advisers for students headed toward medicine, law, theology, 
or engineering. He supplements the major adviser in helping stu- 
dents to arrange programs of study that are relevant to their career 
interest in business. 

In three years of operation, the program has served its purpose 
well, but rather differently from our expectations. In the first place, 
the economics department has found three of the new courses so 
valuable that they have incorporated them into their regular pro- 
gram for majors. These are: accounting, the capital market, and 
industrial organization. The departments of political science and 
sociology have both become interested in the course in administra- 
tion, are participating in its instruction, and are recommending it to 



46 HOWARD G.BOWEN 

their majors. So in a sense, the courses we thought would constitute 
a distinctive business program have simply been absorbed into the 
regular stream of liberal arts instruction in place of other courses. 

I suppose this experience confirms my main thesis that business 
and the arts and sciences are inescapably linked as close partners 
in the education of businessmen. And I suppose my plea would be 
that in our formal arrangements for the education of businessmen, 
those who represent the business schools and those who represent 
the college of arts and sciences must function as partners in a joint 
enterprise. This partnership, I think, is of the greatest importance 
to the future of America which needs future generations of broadly 
educated and statesmanlike business leaders. 



The Business School, 
The University, and 
The University President 



BY FRED C. COLE 

President 
Washington and Lee University 



X 



.he relationship that a university president has with a 
school of business, as well as with any other school, is determined 
by the conditions of his office. He is responsible for the welfare 
of the institution as a whole. He cannot view the whole merely as 
the sum of its parts. He must see it as something greater, or there 
can be no unity or coherence in the institution. When dealing with 
the problems of one school or department, the president will usually 
be less familiar with details and techniques than members of the 
school or department are. Most scholars are laymen, or at best 
dilettantes, in fields outside their own; and if the president has 
come to his office from a military or administrative background, as 
is sometimes the case, he may be a layman regarding scholarship 
generally. But if the president does not see the trees as well as mem- 
bers of the school or department do, he has a better view of the 
forest, and its relation to the general topography. Also, whatever 
his personal background or interests may be, he should possess or 
should cultivate an understanding and appreciation of specific in- 
ternal problems and viewpoints. In fact, in my own case, I may very 
well have more respect for the professor of accounting than I have 
for a historian because I do not properly understand the subject 
of the former. 

Some Presidential Responsibilities 

Although he sees the whole as greater than the sum of its parts, 
the president must perceive the value of each part. Whatever his own 
predilections may be he must do his utmost to see that competence 



50 FRED C. COLE 

is recognized and rewarded whether it is displayed in one field or 
another. Every college and university, especially one under private 
administration, chooses what kind of programs it will provide and 
what it will not. Once a program has been undertaken, however, it 
should be accorded importance and dignity comparable to that of 
any other. If harmony is to prevail in an academic flock there can 
be neither an ugly duckling nor a uniquely beautiful swan. 

Keeping peace and balance in this way is not always easy. One 
division of an institution may become particularly strong through 
the competence of its faculty, receipt of an endowment or grant, or 
other factors. The president could hardly be expected to restrain the 
development of such a division, and yet it may be quite difficult to 
bring the rest of the institution quickly up to the same standards. 
Nevertheless, that is what he must attempt to do. Sometimes a par- 
ticular unit seems to lose its educational value because of changing 
needs in education generally or in the position of a single institution. 
A decision must be made whether it should be stimulated or dis- 
continued. Even if no such extreme imbalances exist, many profes- 
sors in the arts and sciences divisions look down their noses at 
those in professional schools, who retaliate — or initiate — by asking 
"what good" are the arts subjects to students who will have to earn 
a living. 

The Concept of Liberal Studies 

Many collegiate schools of business have come through these stresses 
and strains remarkably well. From schools of bookkeeping and 
shopkeeping, teaching highly specialized courses even in English 
and mathematics, they have become more and more colleges of 
liberal studies. (Here I believe it appropriate to give a definition of 
liberal arts and sciences. In my view liberal studies are those which 
free the mind, which lead to understanding, which create humility 
and tolerance, which afford a basis for continuing study and learning. 
They are thus distinguished from studies which are self-terminating, 
which do not propose to lead to other knowledge or motivate the 
student to seek other knowledge. A professional curriculum may be 



The Business School, the University, and the President 51 

liberal in this sense, but it is not necessarily so; an arts and sciences 
curriculum should be liberal, but it is not always so.) To return to 
the liberalization of study in collegiate schools of business, the 
transition has not, of course, been uniform among all schools. But 
business education in general has undergone, and is undergoing, an 
admirable adaptation to changing needs and conditions. I know of 
no other general field of higher education which has been more 
extensively altered in such a short time. For example, the recent 
reports emanating from the Ford Foundation and the Carnegie Cor- 
poration were out of date on publication in regard to a sizable num- 
ber of schools of business. 

The President and the Business School 

The president of an institution which includes a school of busi- 
ness should take every opportunity to foster and to publicize this 
trend. He should see that the liberal content and techniques of 
modern education for commerce and administration are appreciated 
by the people in the traditional disciplines. Conversely, he should 
point out that the importance of study in such disciplines is being 
increasingly recognized in professional education. Awareness of these 
things is important not only to mutual regard among educators, 
and the harmony within an institution, but to the public understand- 
ing of what a school of business administration is today. 

It is also important to prospective students; and this is a group 
to which the president should give considerable attention. A faculty 
usually has authority in deciding what shall be taught, but often has 
little voice in the question of who shall be taught. Every September 
brings a surprise package. For business administration faculties over 
the country as a whole, the surprise has not been entirely pleasant in 
recent years. I was pleased to learn when I went to Washington and 
Lee that the student body in the School of Commerce and Admini- 
stration did not exhibit the lower aptitude which some other schools 
of business report. I believe this inferiority is diminishing in the 
schools which have modified their curricula in the direction of liberal 
education. The kind of young man who has taken business adminis- 



52 FRED C. COLE 

tration because it is "easy" will be and should be disappointed in 
a program which emphasizes fundamental principles and the de- 
velopment of analytical ability, rather than bookkeeping and shop- 
keeping. 

The fact that students may not be the worst, or as good as others, 
in an institution, however, is cause for only negative pride, at best. 
Efforts should be made toward continuing improvement; and it is 
the duty of a president to see that such efforts are made. The president 
should bring the faculty into partnership in this enterprise. As the 
curriculum and the student body must be worthy of each other, the 
people responsible for the former should have some say about the 
latter. The faculty should not only have a voice in the establishment 
of standards, but should also assist in activities which may result in 
improving the quality of the student body. I do not mean to suggest 
that faculty members should become merely participants in hard sales 
or rooting recruiters. Their participation should take the form of 
cooperation with secondary schools for the general advancement of 
the educational system. Where such cooperation takes place, students 
go to college better prepared; and counselors in the secondary schools 
recommend the cooperating colleges to more of their better grad- 
uates. 

Another obligation of the president, as I view it, is to help 
to set the tone, to establish the climate, in which faculty members 
should work. He should make it clear whether faculty members 
are to be teaching-machines, employees on a forty-hour week, or 
scholars. Scholarship may be exhibited in different ways. The most 
common way is to engage in research in the subject matter of one's 
discipline. Despite the widespread claim that research does not help 
teaching, I believe that in most cases it does increase teaching effec- 
tiveness. A man interested enough to seek new knowledge, or to 
synthesize knowledge, should be able to communicate knowledge 
in a more stimulating fashion than one who is content to pass along 
what others have learned or said. On the other hand, I do not sub- 
scribe to the publish-or-perish doctrine. Creative teaching is just as 
important as all but the most creative research. We have much to 
learn about our own work of instructing and inspiring our students. 



The Business School, the University, and the President 53 

A man who finds a way to produce better-educated graduates, by 
ever so little, makes a far greater contribution to learning and to 
society than the one who produces a monograph which is read only 
by other people writing monographs on the same subject. 

The college faculties must not only teach their students but must 
reproduce their own kind, and turn out graduates who will come 
back, or will go to other campuses, as faculty members. The presi- 
dent of an institution is acutely conscious of this need as he is faced 
with the continuing problem of replacement and strengthening in 
the faculties — although the deans and department heads feel it 
just as strongly, and more personally, if not as constantly. In helping 
to establish an atmosphere of scholarship and to obtain better stu- 
dents, the president will contribute to the fulfillment of this need. 
In so doing he also will enhance the prestige of the institution. We 
do, of course, want successful industrialists and financiers and other 
controllers of wealth among our alumni, for more reasons than the 
most obvious. Yet the prestige of an educational institution, I be- 
lieve, depends more upon its production of seed corn than upon any 
one other factor. This is certainly true within the field of teaching 
itself; and I am convinced that the colleges which inspire capable 
men to careers of scholarship come to enjoy, in the long run, the 
greatest esteem among all significant sectors of society. I will go 
one step further: a man who is encouraged to think of himself as a 
teacher and scholar, and is prepared to become one, will be far more 
successful in business or elsewhere than others. 

In his position as a sympathetic and deeply interested layman, 
unless he comes from the field of business administration, the presi- 
dent will have many questions and suggestions regarding a school 
of business and administration and other divisions of the university. 
These observations may not always appear to be pertinent, and 
sometimes they seem downright impertinent; but they will usually 
be intended sincerely, and they should be accepted in that vein, until 
proven otherwise. 

There is always a danger that people within a profession or field 
of specialization may become too professional or specialized in their 
outlook, and will come to define values only in their own terms. A 



54 FRED C. COLE 

newspaperman, for example, no matter how exactly he may observe 
the journalistic code of ethics and how convinced he may be of 
the public responsibility of the press, may believe that the news 
merits of a certain story outweigh such considerations as the invasion 
of privacy or violation of good taste. To a sociologist, or someone 
taking a broader view of the impact of the story upon society, it 
might appear that the right of the public to the information involved 
does not excuse the violation of good taste or the invasion of privacy 
if no specific social purpose is served by publication of the story. 

Twenty years ago, if I had asked a professor of business adminis- 
tration what he was about, he probably would have told me that he 
was teaching people how to be successful in business. As a young 
historian I might have thought it was more important that he teach 
his students how to make business an increasingly effective institution 
within the democratic system. Today, I believe, many collegiate 
schools of business are doing just that, while at the same time and 
in the same process training successful businessmen. 

The view from the outside is, of course, not always right; and 
that from within surely is not always wrong. The reverse is more 
probably closer to the truth. Nevertheless, it is the president's duty 
to see that the long perspective is taken into account in the programs 
and policies of the respective divisions of the institution. 

By the means I have listed, the president may be able to help 
a school of business to become a positive force in the development 
of the institution of business. Such a school should lead the way and 
blaze new trails as much as a school of medicine does or should. 
It must select its students, potentially the directors of our economic 
life in the coming decades, for qualities which will make them suc- 
cessful as community and civic leaders as well as managers of com- 
mercial operations. It must inculcate in them an appreciation of 
personal and institutional reponsibility to society. In short, it must 
produce graduates who are not good businessmen only, but good 
citizens and educated gentlemen, in the broad sense of the terms. 

This is, of course, no small assignment — even with the help of 
presidents. But it is well worth the effort of the presidents and the 
collegiate schools of business. 



A Chancellor Looks 
at Business Education 



BY WILLIAM B. AYCOCK 

Chancellor 
University of North Carolina 



jLor more than a half-century the American Association 
of Collegiate Schools of Business has provided leadership in up- 
grading the quality of business education. Since the business school 
of the University of North Carolina was admitted to membership 
in 1923, it has profited from its affiliation with this organization. I 
wish my presence today could be regarded as a fruitful effort to 
repay a little of what the University of North Carolina has received 
from your organization. Your Vice-President, Dean Maurice Lee, is 
responsible for my being here. He knows full well that this audience 
will not hear any profound or exciting pronouncements from me on 
the subject of business education. Frankly, I suspect that my participa- 
tion can be attributed largely to the efforts of an able dean to uplift 
the educational level of his chancellor. 

The fact that one in seven bachelor degrees awarded men stu- 
dents in this country is in business administration emphasizes the 
magnitude of the subject. We are dealing with a "whale" in educa- 
tional waters. It is not surprising that such a huge target is inviting to 
a multitude of harpooners. Herman Melville in "Moby Dick" con- 
cluded that the large number of misses by harpooners was due to the 
fact that they were fatigued by laboring at the oars preliminary to the 
thrust. He suggested that the "harpooners of this world must start 
to their feet from out of idleness, and not from out of toil." 

I have not come here out of idleness, and even if I had, I have no 
inclination to cast harpoons at business education. Instead, I shall 
address myself to a few thoughts on education which I think are 
relevant to education for business leadership. 



58 W, B. AYCOCK 

The Role of Education in Our Society 

Any effort to focus on a segment of our vast educational system 
needs to be done in the context of the role which education is ex- 
pected to play in our society. Daily we are reminded that we are 
engaged in gigantic competitive struggles. It is imperative that the 
free world compete successfully in the race for military superiority, 
for the conquest of outer space and for a fair share of the world's 
economic markets. Further, we are engaged in a contest between 
the free world and communism to win to our side the uncommitted 
peoples of the earth. There are great dangers inherent in these un- 
bridled competitive struggles. The continued existence of our kind 
of civilization demands leadership of the highest order. Moreover, 
we cannot be content to confine our objectives to mere preservation 
of our way of life. Simultaneously, we must search for ways to ad- 
vance nearer to the goals of peace, justice, mercy and understanding 
of all mankind. 

Each level of our vast educational system is expected to contri- 
bute to the development of leadership essential to achieve these 
objectives. Professional education, of course, has a vital role in the 
development of capable leaders. In this context, education for busi- 
ness leadership is fundamentally the same as education for the other 
professions. 

The School of Business and the Total University 

I shall proceed, then, to focus my remarks on some of the re- 
sponsibilities of a university and of its school of business. In a 
university, the school of business must depend upon the quality of 
work offered elsewhere in the university — in the arts and sciences, 
the humanities, the physical, social, and behavioral sciences for the 
background work its students receive before coming into the profes- 
sional curriculum. Thus it can be said that the university owes to its 
school of business a solid and meaningful program of pre-business 
administration offerings upon which the business school may build 
its own curriculum. This means that a student should deal with sub- 
ject matter which will assist him to unlock his own intellectual 



A Chancellor Looks at Business Education 59 

powers. It is generally agreed that the arts, classics, literature, science, 
languages, history, music, philosophy and religion constitute most 
of the so-called "liberalizing" areas of study. 

The Importance of a Liberal Education 

So much has been said about the importance of a liberal education 
recently that perhaps many of you have become weary from a repeti- 
tion of even so vital a subject. A story in The New York Times a 
few days ago dealt with the repetition of words and phrases in read- 
ing books used in the primary grades. The complaint was that bright 
children become bored with reading the same words again and again, 
and as a consequence, often lose interest in reading. To illustrate this 
point, the writer of the article quoted from a book report of a young- 
ster which stated in essence that the reader liked to read about pen- 
guins, but this particular book told her more about penguins than she 
really wanted to know about penguins. I am confident that this audi- 
ence is acutely aware of the necessity for a student to develop com- 
petence in English grammar and composition and mathematics and 
that each of you has a deep appreciation of the values which can be 
derived from a study of the "liberalizing" courses at the pre-profes- 
sional level. Further, it is clear from long experience that successful 
completion of a prescribed number of these courses does not insure 
that a student enters professional school adequately prepared for the 
challenge which should await him. 

The sustained effort of wise teachers at the pre-professional level 
is essential to enable young people to understand that future growth 
in any profession requires that the mind be nourished early with the 
wisdom of the ages. One of the difficulties is a tendency of many 
young people to discount the importance of a general education. 
They often see the educational process solely through the lens of an 
occupational specialty and they are quite satisfied when the narrow 
approach is taken by a teacher. For example, a student aspiring to a 
career in business is likely to manifest considerable interest in a 
foreign language when it is made clear that the objective of the 
course is to assist him to carry on business in a foreign country. This 



60 W. B. AYCOCK 

is all right as far as it goes. Frequently, however, students do not 
feel short changed when the opportunity to learn about another 
land, its history, literature and its people, is not pursued. One in 
his formative years is unlikely to appreciate the values inherent in 
study which encourages the art of thinking, the urge to experiment, 
and the importance of creativity. The key to overcoming this diffi- 
culty is found not just in the undergraduate courses taught but in the 
quality of the teaching. The university has a responsibility to insure 
that pre-professional students are provided instruction by a sub- 
stantial number of able and experienced faculty members. 

A university is unlikely to meet this responsibility if it takes a 
position that a faculty member on the advanced level is entitled 
per se to greater recognition or larger compensation than an equally 
competent faculty member at the pre-professional level. One level 
of instruction in a university is equally important with another 
and differences in salary scales when they exist at the various levels 
should be justified on other grounds such as the law of supply and 
demand. Professional schools (there are eleven on the campus of 
the University of North Carolina at Chapel Hill) should not insist 
on preferential treatment salary-wise simply because they are profes- 
sional schools. If a professional school succeeds in bringing this 
preferential treatment about, it has become a party, with rare ex- 
ceptions, to drying up the well springs of the professional school. 
Professional schools can also help a university fulfill its responsibility 
for adequate pre-professional education by refusing to accept stu- 
dents who are inadequately prepared and thereby strengthen con- 
siderably the hands of the instructors at the pre-professional level. 

The Role of Professional Schools 

If a student were the recipient of good teaching during his pre- 
professional years, it is important that it be continued in a profes- 
sional school. At best, he captured only a few of the great lessons to 
be derived from a sound basic education and it is necessary and 
desirable that new opportunities for broad growth await him in a 
professional school. All professional schools require a core of basic 



A Chancellor Looks at Business Education 61 

courses and a study of subject matter designed to orient the student 
in the ways of a particular profession. This, I suppose, is a principal 
reason for establishing professional schools in the first place and 
remains the primary justification for their continuation. I have al- 
ways believed, and after nearly a decade of teaching in law schools, 
I still think that most professional courses can be taught in the li- 
beral arts tradition. There is no basis to assume that they cannot and 
substantial reason to insist that the "liberalizing" process should con- 
tinue in professional schools. Edmund Burke expressed disinterest 
in a legal education because it "sharpened the mind by narrowing it." 
Fortunately, in recent years the concept that law schools are the 
place to learn "to press suits and clean clients" has often been dis- 
proved by law teachers who have demonstrated that the study of 
law can both liberalize the mind and provide the basic technical 
training essential for a career in the legal profession. For example, 
one who undertakes to teach the anti-trust laws without regard for 
the historical background out of which these laws emerged is not 
only ignoring an opportunity to teach much about the business world 
just prior to and immediately after the turn of the century, but 
also is doing a poor job in teaching the current application of these 
laws. Moreover, he will not be able to discuss intelligently the 
future development of this body of law. In short, courses in pro- 
fessional schools properly taught can provide both the short term 
knowledge and the long term values essential for leadership. 

It is important in the preparation for any profession to instill 
in a student a high sense of moral responsibility. There are sound 
reasons to assert that progress has been made in this vital phase of 
professional education. Professor Allen Nevins addressed himself 
to this point a year ago as follows: 

"Few ideas are more fallacious than the notion that the pioneers 
and early nation builders were more virtuous than the people of 
our later era. Professional requirements were low: the quack flour- 
ished in medicine, the shyster in law, the ignoramous in the ministry. 
A great deal of business followed the rule of caveat emptor, the 
principle of David Harum: 'Do unto others as they would do unto 
you, and do it fust.' In ethics, today, three standards may be dis- 
tinguished: legality, honesty and honor. In the processes of change, 
men are more conscious today that mere legality is not enough." 



62 W. B. AYCOCK 

The necessity for the kind of teaching I have been discussing 
must carry its influence beyond formal education. We want our 
young people to complete schooling imbued with the spirit of con- 
tinued study. Norman Cousins commenting on the education of 
Benjamin Franklin stated: "It never occurred to him that there was 
any point at which he could say that his learning was adequate for 
his life's work or for life itself. He could no more conceive of cut- 
ting his mind off from its natural food, knowledge, than he would 
expect to function physically in a starved condition." I am confident 
that the only way in which our educational system can measure up 
to its challenge to produce the leadership so desperately demanded by 
the times in which we are privileged to work and live is to provide 
good teaching of the kind to which I have referred. To achieve this, 
many obstacles must be overcome. Unquestionably, it is the respon- 
sibility of one charged with the affairs of an institution to take the 
leadership in overcoming these obstacles. 

Identifying the Objectives 

Too often, institutions with inadequate resources have dissipated their 
energies and diminished their effectiveness by undertaking to be all 
things to all people. Even a complex university must define its mis- 
sion — otherwise, its activities will spread far beyond its resources. A 
primary duty of the head of an institution is to insure that the talents 
and energies of faculty members are not spread too thinly. To do so, 
it is essential for him to take the lead in rejecting new ventures out- 
side the mission and resources of the institution. President John W. 
Gardner of the Carnegie Corporation put his finger on the matter 
when he observed that an "excellent plumber is infinitely more ad- 
mirable than an incompetent philosopher." But he went on to say 
that too often we get neither good plumbing nor good philosophy. 
An institution geared to develop the nation's leaders which permits 
itself to be transformed into one engaged in training for a con- 
glomeration of narrow vocational specialities renders a disservice to 
the business profession and to the nation. 



A Chancellor Looks at Business Education 63 

I am aware that it is fashionable in higher education circles to 
look down noses at vocational education. Let me hasten to say that 
the demands of the business world, for example, for large numbers 
of people with specific job training are justifiable. But I do question 
the wisdom of undertaking this kind of educational program in a 
college or university. There are many kinds of educational institutions 
and each should stick to its own mission and each should be proud 
of its achievements in its chosen field. It is the duty of a university 
head to insure that choices of programs be made and that they are 
consistent with the mission of the institution. For example, a program 
for business executives geared to the standards of higher education 
is an appropriate undertaking for a business school; whereas, a 
program to train receptionists for the outer offices of business execu- 
tives clearly would not be. 

Maintaining a Balance Between Teaching 
and Research 

In most faculties there will be people who are primarily teachers 
and others who are primarily researchers. This is, in itself, a healthy 
situation because institutions of higher learning have a responsibility 
for both teaching and research. They are interrelated activities. In 
fact, it is likely that most research scholars were inspired by great 
teachers. It is the obligation of a university to maintain an appro- 
priate balance in these dual activities. In some professional schools, 
the research function is neglected; whereas, in others it is over- 
emphasized in the sense that research has become the preferred 
road to promotions, salary increases and distinction in the scholarly 
world. Occasionally, I have wondered if this result is not partially 
attributable to the fact that it is easier to scan a publication list than 
it is to determine whether or not a teacher inspires and stimulates 
his students. Admittedly, there are scholars who do not possess the 
qualifications to teach. In such instances, provision should be made 
to allow such a person to engage full time in research. On the other 
hand, one who can teach should not be encouraged to forego this 
responsibility simply because it is regarded as inferior to research. 



64 W. B. AYCOCK 

Another facet of this problem is the necessity for concern for the 
kinds of research in the same degree that there is concern for the 
types of courses taught. It is the duty of a university administrator 
to insure that the research mission of his institution is denned and 
that policies are formulated in respect to the exercise of this function 
which are consistent therewith. 

Businessmen in increasing numbers have responded to the call 
to serve in important positions of leadership in forums both large 
and small. It is essential that a school of business, with a responsi- 
bility to develop much of the needed leadership, be in the main stream 
of the intellectual life of an institution. This is not likely in those 
instances in which the business school is regarded as a proprietary 
operation — i.e., to make money for the university with little regard 
for the kind of program to which I have referred. Education for 
business leadership requires students capable of growth, a curriculum 
designed to encourage growth, and a faculty which inspires growth — 
intellectually, morally, and spiritually. A dean who understands the 
necessity for "educated" business leaders, and, accordingly, under- 
takes to operate programs with that objective in view, needs and 
deserves the help and the support of his colleagues and the head 
of his institution. 



Mathematics for 
Business Students 



BY SAMUEL GOLDBERG 

Visiting Associate Professor 

Harvard University, Graduate School of Business; 

On Leave from Oberlin College 



I 



SHOULD LIKE to begin this paper — as a mathematician 
should — by stating the premises upon which my subsequent com- 
ments are based. 

First, I assume that the educational program of the business 
school looks to the future and is therefore properly keyed to the 
long rather than the short run life of the student. We do not aim 
to teach students all they will ever need to know, a manifest impossi- 
bility, but rather to prepare them for continuing self -education as 
they develop in the years following their degree-seeking education. 
This is equally true at all rungs of the educational ladder — for doc- 
toral candidates preparing for teaching and research careers, as well 
as for undergraduates and M.B.A. students planning on jobs, at 
whatever level, in industry. The mark of the superior student in this 
post-university learning process is not only his ability to become 
expert in his own field, but perhaps of equal importance, his ability 
to communicate intelligently with specialists in those other fields 
(mathematics, for example) that are or will become relevant to 
his own. 

My second premise is that mathematical methods and models 
have already had a significant impact on business practice and theory 
and will continue to have an increasing effect as time goes on. Here 
we recognize not only the growing importance of mathematical 
techniques, but also the rapidly accelerating ability by means of 
electronic computing systems to make such techniques usable in the 
day-to-day operation of a complex business enterprise. 



68 SAMUEL GOLDBERG 

I presume that the current concern of our business schools with 
the whole area of mathematics and its role in the school program is 
accounted for by their acceptance of the reaction to the two premises 
just enunciated. Their interest in making curriculum revisions that 
modernize existing mathematics requirements or add new ones is 
now commonplace. Since there seems to be fairly general agreement 
on the need for such revisions, I shall not focus here on whether 
such changes should be made, but rather on whether they can be 
made and, if so, in what form these adjustments are optimally made. 

One other preliminary remark is in order. A speaker here, rec- 
ognizing the fact that you represent business schools of so many 
different sizes and with so many different programs, must be content 
with remarks of a somewhat general nature. I look forward to the 
discussion session for the opportunity to elaborate on some of the 
points raised here and to discuss more particular questions that you 
may wish to raise. 

Any discussion of the present subject must consider the following 
questions: 

(1) With what prerequisite training in mathematics do our stu- 
dents arrive at the business school? 

(2) What mathematics program is best for these students? 

( 3 ) Who should teach this mathematics? 

(4) Will the subsequent work the student takes reflect the fact that 
his training includes this mathematics? In other words, what 
is the relevance of this mathematics to the entire business 
school program? 

Let me first consider with you the ideal answers that might be 
given to these four questions were this, contrary to fact, the best of 
all possible worlds. 

Prerequisite Training in Mathematics 

Ideally, students entering an undergradaute business college would 
offer for admission at least three years of high school mathematics. 
But more important than the credit they bring, they would have 
reasonable competence in algebra, geometry (including graphing 
and some analytic geometry), and in the elements of trigonome- 



Mathematics for Business Students 69 

try. It goes without saying that they would have complete command 
of the basic arithmetical operations. And, of course, students entering 
a graduate school of business would have already studied the kind 
of undergraduate mathematics that I shall shortly describe. 

Each person you consult will have his own view of the mathe- 
matics program that ideally would be offered to an undergraduate 
business student. I trust that my view will serve as a starting point 
for our later discussion. I assume that we are speaking of a required 
course limited to three quarters or two semesters. 

This course should be designed for the business student. It 
should not be merely the first half of the standard calculus sequence 
presently offered to engineering and science students. Not only 
should subject matter be specially selected for inclusion in this 
course, but illustrative and problem material should be used to point 
up business applications of the mathematical techniques under study. 
Such material is important not only to reinforce learning, but also 
to motivate students by reminding them that the mathematics they 
are studying is used in the literature of their own field. One of the 
practical difficulties in instituting such courses is the fact that text- 
books are not yet in good supply. But with the market demand 
high, we can count on the publishers to produce useful books soon. 

The first quarter, or perhaps the first semester, of such a course 
could concentrate on pre-calculus material of the type we have 
come to refer to as finite mathematics. This title includes such subject 
matter as elementary logic, sets and relations, the beginnings of prob- 
ability theory, and topics in linear algebra such as vectors and 
matrices. The remainder of the year could be devoted to the dif- 
ferential and integral calculus, including some work with the formu- 
lation and analysis of simple mathematical models in economics and 
business which make use of difference and differential equations. 

Although there are those who say that this year-course should be 
a broad survey of as many potentially useful mathematical topics 
as possible, my own view is that students benefit very little from this 
once-over-lightly approach. They are given a veneer and some termi- 
nology, but no understanding of mathematical thinking and methods. 
It seems to me wiser to recognize at the outset that we cannot intro- 



70 SAMUEL GOLDBERG 

duce students in one year to as many topics as we might like, and 
then to develop our course around a smaller number of topics that 
can consequently be pursued more deeply. Of course, the topics 
selected will vary with the instructor and school, but the resulting 
variety is all to the good as we experiment in the development of 
new courses. 

I hasten to add that such a year-course is the minimum exposure 
to mathematics that should be required of all students in the busi- 
ness school and upon which subsequent courses, especially statistics, 
should build. Selected students should be encouraged to elect further 
work in mathematics. 

Using Mathematics Elsewhere in the Curriculum 

Ideally, this mathematics will be taught by mathematicians who 
are not only skilled teachers, but who have real interest in business 
and social science applications of their subject. Such teachers will be 
able to take some students beyond the first course into elective 
courses, seminars, or independent study programs in mathematics 
as related to business problems. Here let me add parenthetically that 
I believe your faculty members who are attending the Institute of 
Basic Mathematics at the Harvard Business School have neither the 
training nor the inclination to become involved in teaching mathe- 
matics when they return to their jobs. They, understandably, are not 
interested in mathematics per se, but in its applications to their own 
fields of interest. I shall return later to these men and an important 
function that they have to perform in this area. 

Ideally, the mathematics undergraduates are required to study 
will be used in subsequent courses in the business school. Of special 
importance is the possibility of up-grading the statistics course due 
to the increased sophistication with the use of symbols and the back- 
ground in probability theory and calculus that students will bring to 
the course. 

But professors of economics, marketing, finance, production, in 
the ideal situation we are describing, would also make use of mathe- 
matics whenever it seemed advisable and helpful in their own courses. 



Mathematics for Business Students 71 

Their textbooks would no longer shy away from simple mathematical 
arguments. Students, especially at the graduate level, could be ex- 
pected to read research articles, like those published in Operations 
Research or Management Science, that make use of simple mathe- 
matical models and techniques. 

As you know, we are now quite far from this ideal state of affairs. 
I would like to spend the rest of my time indicating some of the 
things that can be done in the years ahead that will move us toward 
our goal. 

First, with respect to mathematical prerequisites: Let the busi- 
ness schools announce that entering students will be required to 
have at least three years of high school mathematics. If, in a transi- 
tion period, we must continue to teach high school algebra and 
trigonometry in the colleges, then let us not give college credit for 
these courses. A substantial effort is now being put forth to improve 
the content and teaching of high school mathematics. I suggest that 
the business school community join the scientists and engineers in 
emphasizing the importance of mathematics for its students. Re- 
quiring students who plan careers in business to have three years of 
a sound high school program in mathematics is entirely reasonable. 
Anything short of this makes it well nigh impossible to organize a 
worthwhile college mathematics requirement limited to one year. 

Let us also strike the final death blow to the already dying courses 
that are variously called business arithmetic, business mathematics, 
or mathematics of finance. The essential facts about compound in- 
terest, present value, amortization, and related matters, can be kept 
in the curriculum, but should be presented in a more mathematically 
acceptable fashion as a very small unit, either in the required mathe- 
matics course or in a finance or controls course that business students 
will take after the mathematics course. 

Some Practical Considerations 

The faculty needed to teach mathematics in our colleges is al- 
ready a scarce resource and I therefore have some doubts about the 
feasibility of instituting mathematics requirements for the large 



72 SAMUEL GOLDBERG 

number of students presently enrolled in business schools. If you call 
up the chairman of the mathematics department in your university 
to discuss the development and staffing of the kind of course we have 
discussed, you are likely to have a difficult time. The chairman, based 
on his previous knowledge of your students and the attitude toward 
mathematics that you have permitted them to maintain, is on his 
guard. He probably does not understand the particular needs of your 
students and he is now overburdened with problems involved in 
finding adequate staff for the elementary courses already in his 
charge. If he must star! a course for students of business, he will likely 
do two things. First, he will suggest that your students be required 
to take one or more of the courses that are already being offered 
by his department. Then he will seek graduate student assistants to 
staff the additional sections of these courses that will be arranged to 
meet the increased enrollment. These graduate students will have 
neither the background nor the interest that is necessary to do a 
first-rate job in the classroom. The result will not be good — it will 
put a mathematics requirement on the books, but students will not 
get from it what they should. 

In my opinion, this solution at its worst is definitely worse than 
doing nothing. I beg of you to ask yourself whether an across-the- 
board mathematics requirement for all your students is feasible in 
your university setting and then to pay special attention, in consul- 
tation with the department of mathematics, to the nature of the 
course and to the interests and abilities of the staff needed to imple- 
ment effectively such a requirement. 

The important thing is to have a high quality program. If serving 
all students requires a drastic lowering of quality, then I would think 
about the possibility of starting a mathematics program for selected 
groups of well-motivated and well-prepared students. With smaller 
numbers, the staffing problem is easier to solve and senior faculty 
members may be more readily interested in developing and teaching 
a mathematics course for these students. Such a course, if successful, 
could grow in enrollment and ultimately become a required course 
for all students in the business school. 



Mathematics for Business Students 73 

One other reason for going slowly is the fact that the substantive 
areas in business are still not using much mathematics, at least not 
in the classroom. It is in this area that I hope your faculty members 
now at the Institute of Basic Mathematics will play a central role. 
They will be asking themselves where the mathematics they have 
learned fits into the courses they teach and the research they plan. 
I am confident that teaching materials will become available in 
which mathematics is used, whenever it is helpful, in business text- 
books and cases. More research on mathematics in business is needed 
and it has been suggested that summer workshops be organized in 
which small groups of people trained in mathematics and marketing, 
let us say, can critically review the literature and develop new ideas 
concerning the application of mathematical models and techniques 
in marketing. Similar workshops could also be held in other business 
areas as well, for example, in finance and production. 

Mathematics at the Graduate Level 

One final word concerning our graduate programs. It seems to 
me high time that we required of all masters and doctoral candi- 
dates in business and economics at least the minimum acquaintance 
with mathematics that I have described as suitable for undergrad- 
uates. Those that stop with this minimum contact will at least be 
able to read some of the literature in their field which uses mathe- 
matics. And as managers, they will be better able to consult effective- 
ly with those on their staff who are using mathematical techniques. 
Most important of all, we need to encourage more doctoral candi- 
dates to take even more mathematics. We will need them in the 
business schools when they start to teach and train future generations 
of students. 

In summary, I remind you of this obvious fact: the school that 
distinguishes itself in this new area will have to point to what hap- 
pens in the classroom and in its students' minds, not to what is 
printed in its catalog of courses. We shall all have to work hard to 
come up with solutions to the many problems that a mathematics 
requirement for business students brings to the surface. 



Behavioral Science in 
The Business School 



BY H. J. LEAVITT 

Professor of Industrial Administration and Psychology 

Graduate School of Industrial Administration 

Carnegie Institute of Technology 



I 



PLAN TO USE my feelings at this moment in my classes to 
illustrate the idea of "ambivalence"; the idea that strong but op- 
posing feelings can exist in the same person at the same time. On 
the one hand, this is a moment of sheer joy because I, a faculty mem- 
ber, have my clutches on a roomful of captive deans; but I also 
feel sheer, nightmare terror, because a roomful of deans have their 
clutches on captive me. 

I was asked to talk as concretely as possible about the behavioral 
sciences in business schools; and I shall try to do so. This talk will 
not be entirely analytic and objective, though, because I do have an 
ax to grind. I want to try to convince you that education in the 
behavioral sciences is relevant and practicable for business students. 
And more than that, to try to convince you that the behavioral 
sciences are more relevant and practicable when taught as a body 
than when taught as fragments related to special functional fields. 

My case will rest essentially on a description of some subject 
matter, some illustrations of ways in which it can be taught, and 
some rationale for teaching it. 

The Concept of the "Behavioral Science" Phrase 

Because the phrase "behavioral science" can mean many things, 
let me start by saying what I think it should not mean in the busi- 
ness school. It should not mean the section of the personnel course 
on tests; plus some pieces of job evaluation methods; plus some sur- 
vey and questionnaire techniques from marketing. Nor should it 
mean the classical industrial or personnel psychology course offered 



78 H. J. LEAVITT 

by the psychology department; nor even the general psychology or 
introductory sociology course. Nor should it mean a course purely 
concerned with human relations skills. 

It should be a body of subject matter (drawn partially from 
the social sciences and partially, indeed increasingly, from funda- 
mental new research within business schools and business organiza- 
tions), centrally concerned with the behavior of people in organi- 
zations. 

To be a little more concrete, a practicable and useful business 
school behavioral science course can be designed around such sub- 
categories of organizational behavior as these: 

1. The individual human being, and how he behaves; 

2. Relationships between individuals, e.g., problems of influence, 
persuasion, behavior change; 

3. The behavior of people in groups, e.g., problems of group pres- 
sure on the individual, conditions of efficient problem solving 
in groups; 

4. The behavior of large organizations of people, e.g., the effects 
of organizational structure on individual and group perform- 
ance. 

I submit that these are subject matter areas about which we have 
some substantive wisdom — though not very much — and about which 
we know how to specify some problems and to encourage some 
inquiry. I submit further that much of good teaching in the behavior- 
al sciences should aim at this second purpose — the guidance of the 
student into analytic encounters with interesting problems — even if 
those problems have as yet no general solution. 

Behavior of the Individual 

To return to the subject matter. First, the nature of the individual. 
This is one area in which I do not believe we know much more than 
we did a decade ago, except in one major respect: we know much 
more about human thinking and problem solving (and much 
of what we know has been learned through basic research in a busi- 
ness school — our own). But though we have relatively little that 
is new about human personality, we have some ideas that can be 



Behavioral Science in the Business School 79 

useful to the potential executive who will be spending a good bit 
of his business energy trying to assess and predict the behavior of 
other individuals, and of himself. 

We can examine with students in the part of a course concerned 
with individual behavior such problems as these: 

What is the likely effect on a person's future behavior of a series 
of successive failures? What is the probable effect of successive suc- 
cesses? Why? Similarly what outcomes would one expect from a 
person, B, when that person is extremely dependent on another 
person, A, (who let's say is B's only source of survival)? Would 
B's behavior vary with variations in A's behavior? If A is extremely 
kind will B love A? Will he also hate A? 

Again, how do people SQt their goals? How do levels of aspira- 
tion change? Note that I present these pieces of subject matter in 
the form of questions rather than generalizations. Generalizations 
are possible here, and some of them have considerable empirical 
support. But much seems to be gained by stimulating inquiry into 
such issues in order, first to complicate life for the student, and then 
to help him reorganize his picture of the functioning human being. 

One good reason for talking about individuals in a behavioral 
science course is because we need more understanding of individuals 
to deal reasonably with our second, more immediately relevant 
category of subject matter: The nature of relationships between 
persons. It is obvious that business organizations are sets and sub- 
sets of relationships, and that the carrying out of an organization's 
activities is in large part via the interaction of people. 

Our solid empirical knowledge here is mighty light, too, but 
it has been building up fast. We know a good deal more now than 
we used to about the processes of communication between persons; 
about the nature and measurement of interpersonal influence; and 
about the conditions under which attitudes and behavior are likely 
or unlikely to change. 

Specifically, we can show, essentially by the use of classroom ex- 
periments, the differences between one and two way communication, 
and conditions in between; the effects of one or the other on speed of 
transmission, on accuracy, and on the attitudes the communicators 



80 H. J. LEAVITT 

develop toward one another. We can show it, and we can support it 
with pretty good laboratory evidence. We can even generalize it 
credibly to the workaday transmission of policies or to the supervi- 
sion of work groups in business; using cases or field experiments as 
additional teaching media. 

We can also help students to inquire into the processes of influ- 
ence. How can this class decide here and now who are the most 
influential members of the class? How can one measure influence? 
What are the behaviors that increase or decrease the influence of 
members of a relationship? 

We can move further into study of the general problem of be- 
havior change. What are the methods by which one can modify the 
behavior of others? of students? of children? of bosses? How have 
therapists tried to change behavior? How do Alcoholics Anonymous 
doit? Why? 

I like to assign a small, yet difficult little project at this point. I 
often ask my students to undertake to modify someone else's be- 
havior, and to write up the process, I grade not on the basis of suc- 
cess, but of insight and understanding. Has the student considered 
the alternatives? Does he analyze the implications of them? Has he 
looked into relevant theories of therapy, of education, of political in- 
fluence? Or into more recent behavioral science research in the field? 

Small Group Behavior 

Let me move on to my third category, the next larger unit; the 
group of 5 or 10 or 15 people. 

In this realm we had a great burst of new knowledge in the late 
40's and early 50's. The group has been a subject of intense research 
by social scientists from two points of view. First, we have identi- 
fied uniformities in group behavior and group processes; and second, 
we have developed techniques for changing group behavior. We 
have learned a good deal about the effects of group pressures on 
individuals, and about the methods by which individuals can exert 
pressures on groups. More recently we have been developing some 
fascinating information about the effects of competition and conflict 



Behavioral Science in the Business School 81 

among groups, and about the effect of alternative methods for trying 
to resolve such conflicts. So we are beginning now to study sub- 
groups in the environment of larger groups, an area especially rele- 
vant to business. 

It seems perfectly reasonable that the incipient administrator 
should know a good deal about groups and their behavior, and that 
he should be highly sensitive indeed to the problems that will neces- 
sarily arise as he finds himself tangled in his many different roles 
within an organizational complex of overlapping and competing 
groups. 

Here, too, we have a wealth of already available pedagogical 
tools. We have, for example, simple adaptations of laboratory ex- 
periments to expose for analysis the effects of conformity and devia- 
tion; and the conditions under which individual deviants do or do 
not contribute to group problem-solving. We have experiment-like 
demonstrations of efforts to resolve conflicts between groups; to 
raise the question, for example, of the effects of team failure in a 
competition upon the internal relationships among members of the 
team and upon the subsequent influence of the team's leaders. Cor- 
respondingly we can consider the effects of winning on a team — the 
tendency for the existing organizational and influence structure to 
freeze; for rigidity and resistance to change to set in, at least tem- 
porarily, along with the flag of victory. 

Again, I submit that though we have considerable knowledge 
about small groups, we also have equally important ways of speci- 
fying problems, and of setting up encounters between students and 
group problems; so that they can worry and fret about them; and 
learn to attend — when they deal with groups — to the mechanism 
and process of the group itself, as well as to the tasks the group is 
working on. 

Behavior of Large Organizations 

I come finally to the realm of many-people-at-a-time — the large 
organization of people. 



82 H. J. LEAVITT 

Here new ideas have been building up only recently and some- 
what sketchily, but they have been building up. Certainly we can 
point to a number of recent books about the behavior of organiza- 
tions that are entirely unlike the older organization theory texts of 
1 or 1 5 years ago. 

Specifically, we have some useful ideas about the effects of or- 
ganizations on people, and about the comparative effects on people 
of some different kinds of organizational structures. We have some 
ideas from field research in real organizations; and from laboratory 
research on simulated organizations. We also are beginning to con- 
nect up ideas about organizations from economics, sociology, and 
psychology with ideas directly out of business toward building a 
consistent theory of organizational decision making. 

But besides such general material, we can raise narrower prob- 
lems about, for example, the relationships among communication 
structure, morale and productivity. And again we have alternative 
media available: we can use classroom experiments with communi- 
cation nets; cases; or field studies; or in dire emergency, a straight 
lecture. 

Or we can examine some problems of organizational planning 
and performance by setting up in our classes miniature business 
games which separate to varying degrees the people who plan the 
work from the people who do the work, to try to simulate the prob- 
lem of staff-operating relationships or the general problem of more 
or less participative decision making. We can then take direct mea- 
surements of productivity and morale; and use these measurements 
as a basis for class discussion and generalization. 

We also now have a little data and a lot of wild ideas about the 
likely future direction of organizational change in the United States; 
the problems of organizing groups to perform different kinds of 
tasks than those they now perform. 

Some interesting new ideas about organizational growth have 
been emerging, too, and about the effect of sub-group conflict within 
the firm on organizational decision making. We are just beginning 
to get what may soon be a river of ideas that are bound to be useful, 



Behavioral Science in the Business School 83 

at the junction of the economic and behavioral science streams of 
thought about teams, decision making processes, and competition. 

I have offered this hasty sketch of subject matter areas to try to 
convince you that plenty of problems and ideas exist about the 
behavior of people in organizations; and that these problems and 
ideas are now accompanied by small but significant amounts of 
empirical and theoretical knowledge. Moreover we have, or can 
create with a little ingenuity, some pretty good techniques for get- 
ting students to face and think analytically about these problems in 
ways that will, I believe, be useful to them later in their lives. 

We need lots more knowledge, of course, and lots more prob- 
lems, and lots more ideas about how to teach them. But one reason 
I was willing to tread on the hot coals of this meeting, is because 
business schools are the best place to develop these kinds of knowl- 
edge and problems and methods. Psychology departments and soci- 
ology departments can be darn little help. For we are not, in my 
opinion, concerned here primarily with the applications of psychology 
but with the development of a new and parallel (though, of course, 
not independent) area of behavioral science; the area of organiza- 
tional behavior. 

Teaching Materials and Teachers 

There are two final issues I would like to discuss a little further. 
One is teaching materials and the other is teachers. 

I suggested that we have a reasonable supply of specific ma- 
terials and some pretty good ideas about how to build new ones. 
We have — and we didn't 5 or 6 years ago — some useful books. There 
is my own book, and then, of course, there are the lesser ones. 
Mason Haire's Psychology in Management is a good general text, 
and I know of at least two others in the making. Donald Taylor 
at Yale has one underway; and so does a group at the University of 
Chicago's Business School. 

Within each of the major subject matter categories I have 
mentioned, there are beginning to be good books, too. In the in- 
dividual area, Chris Argyris has a little book on personality theory 
for executives. Warner and Martin have just edited a useful book 



84 H. J. LEAVITT 

of readings called Industrial Man. In the influence-behavior change 
area, we have books like Lippitt, et al., The Dynamics of Planned 
Change; Katz and Lazarsfeld's Personal Influence; Hovland, Janis, 
Kelley's Communication and Persuasion. 

Specialized texts about groups vary from Cartwright and Zan- 
der's Group Dynamics, which is a book of readings mostly about 
experiments with groups, to more observational studies like Homan's 
The Human Group and Whyte's Money and Motivation, to more 
highly theoretical works like Thibaut and Kelley's recent The Social 
Psychology of Groups. 

And about organizations we have modern behavioral science — 
oriented works like March and Simon's Organizations, Chris Argyris' 
Personality and Organization, and the symposium just edited by 
Mason Haire called Modern Organization Theory. And with a little 
search we can dig up literally dozens of appropriate journal articles. 
So though we may be short of ideal readings, we are not short of 
relevant readings. 

Moreover, we have classroom methods and techniques in large 
numbers, ranging from the case to the classroom experiment. 

It is probably clear by now that I hold a bias toward the latter, 
toward adapting laboratory research for classroom demonstration, 
and even more toward designing experiments especially for the 
classroom. Incidentally, it is not just to teach students to do research 
that this experimental emphasis is useful. Its utility lies, I believe, 
in two other directions: first, experiments provide enigmas, dilemmas 
that hopefully will push students toward analytic search for under- 
standing; second the design of classroom experiments is (or can be) 
interesting and feasible and professional faculty research in its own 
right. 

Even more, though, than preaching at you about the gold mine 
of research that may exist right in the backyard of the classroom, I 
want to grab this rare chance to argue for the utility to business 
students of studying things other than specific business practice. 
Experiments and research projects are to my mind important mostly 
because they encourage analysis, not because they simulate the reali- 
ties of the business environment. In fact the business game, which is 



Behavioral Science in the Business School 85 

turning out to be a valuable teaching mechanism, will be useful, 
I believe, not to the extent that it is "really like" business, but to 
the extent that we can design into it interesting problems that de- 
mand inquiry and analysis from the student. 

Finally a word about teachers. I have a prejudice here as well — 
several in fact. The first is that people trained as behavioral scientists 
can more easily learn about business than vice versa. Secondly that 
the business school ought to capture and enslave its own behavioral 
scientists, instead of relying on mercenaries from the psychology or 
sociology departments. 

The reason for my bias in favor of remodeling behavioral scien- 
tists instead of regular business school people is probably already 
quite clear. I think the faculty member needs considerable depth of 
understanding of the behavioral sciences — their literature, their 
current work, their methods — to do a good job. This is no place for 
a diffident professor who is doubtful of his own competence as a 
behavioral scientist. Besides it is more an understanding of the nature 
of men in interaction with one another that needs to be taught in 
these courses, than an understanding of the specific nature of business. 

Part-time mercenaries are risky mostly because they are likely 
to stay closely identified with their origins and to teach what they are 
identified with. And I submit again that business school behavioral 
science is and ought to be different from Psychology department 
psychology or Sociology department sociology. 

In summary, then, my thesis is that a behavioral science course 
can be both sufficiently relevant in its utility to students and relatively 
sufficient in its body of content for current use in business school 
curricula. That, though, like most faculty members, I am regularly 
dissatisfied with what I teach and what gets learned, I am convinced 
that there is plenty to teach and to learn; and that it is basically 
worthwhile for business schools to try to do both. 






Views on business education: * main 
650.071 1A512vC2 



3 15b5 035T3 DM7D 



KEEP CARD IN POCKET 




/